UNITED
STATES SECURITIES AND EXCHANGE COMMISSION


WASHINGTON,
D.C.  20549




FORM
10-K




[X]  Annual
      Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of
      1934




For
      the fiscal year ended December 31,
2009.




or




[  ]  Transition
      Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of
      1934




For
      the transition period from  to .




Commission
      File Number: 0-8667




PUBLIC STORAGE
      PROPERTIES, LTD.


(Exact
      name of Registrant as specified in its
charter)




California
            95-3196921(State
      or other jurisdiction of
            (I.R.S.
      Employerincorporation
      or organization)
            Identification
      Number)701
      Western Avenue, Glendale, California
            91201-2349(Address
      of principal executive offices)
            (Zip
      Code)




Registrant's
      telephone number, including area code: (818)
      244-8080.




Securities
      registered pursuant to Section 12(b) of the Act:
            NONE




Securities
      registered pursuant to Section 12(g) of the
Act:




Units
      of Limited Partnership Interest(Title
      of class)




Indicate
by check mark if the registrant is a well-known seasoned issuer, as defined in
Rule 405 of the Securities Act.




Yes
      [   ]
            No  [X]




Indicate
by check mark if the registrant is not required to file reports pursuant to
Section 13 or Section 15(d) of the Exchange Act.




Yes
      [   ]
            No  [X]




Indicate
by check mark whether the registrant (1) has filed all reports required to be
filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the
preceding 12 months (or for such shorter period that the registrant was required
to file such reports), and (2) has been subject to such filing requirements for
the past 90 days.




Yes
      [X]
            No  [   ]




Indicate
by check mark whether the registrant has submitted electronically and posted on
its corporate Web site, if any, every Interactive Data File required to be
submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this
chapter) during the preceding 12 months (or for such shorter period that the
registrant was required to submit and post such files).




Yes
      [   ]
            No  [   ]




Indicate
by check mark if disclosure of delinquent filers pursuant to Item 405 of
Regulation S-K is not contained herein, and will not be contained, to the best
of registrant's knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K or any amendment to this
Form 10-K.  [X]


1





Indicate
by check mark whether the registrant is a shell company (as defined in Rule
12b-2 of the Exchange Act).


Yes
      [   ]
            No  [X]




Indicate
by check mark whether the registrant is a large accelerated filer, an
accelerated filer, a non-accelerated filer or a smaller reporting
company.   See the definitions of “large accelerated filer”,
“accelerated filer” and “smaller reporting company” in Rule 12b-2 of the
Exchange Act.




Large
      Accelerated Filer [   ]
            Accelerated
      Filer [   ]
            Non-accelerated
      Filer [X]
            Smaller
      Reporting Company
[    ]




The
aggregate market value of the voting and non-voting common stock held by
non-affiliates of the Registrant as of June 30, 2009:




Limited
Partner Units, $500.00 Par Value - $17,954,000 (computed on the basis of
$2,390.00 per unit which was the highest reported sale price prior to the
quarter ended June 30, 2009).




The
number of units outstanding of the registrant's classes of common equity as of
March 25, 2010:




Units of
Limited Partnership Interest, $500.00 Par Value – 20,000 units




DOCUMENTS
INCORPORATED BY REFERENCE




NONE




2







PART I




ITEM
1.                      Business




Forward Looking
Statements




This
Annual Report on Form 10-K contains forward-looking statements within the
meaning of the federal securities laws.All statements in this
document, other than statements of historical fact, are forward-looking
statements which may be identified by the use of the words
"expects,"   "believes,"  
"anticipates,"  "plans," "would," "should," "may," "estimates"
and similar expressions.  These forward-looking statements involve
known and unknown risks and uncertainties, which may cause Public Storage
Properties, Ltd.’s (the “Partnership”) actual results and performance to be
materially different from those expressed or implied in the forward-looking
statements.  As a result, you should not rely on any forward-looking
statements in this report, or which management may make orally or in writing
from time to time, as predictions of future events nor guarantees of future
performance.  We caution you not to place undue reliance on
forward-looking statements, which speak only as the date of this report or as of
the dates indicated in the statements.  All of our forward-looking
statements, including those in this report, are qualified in their entirety by
this statement.  We expressly disclaim any obligation to update
publicly or otherwise revise any forward-looking statements, whether as a result
of new information, new estimates, or other factors, events or circumstances
after the date of this document, except where expressly required by
law.  Accordingly, you should use caution in relying on past
forward-looking statements to anticipate future results.  Factors and
risks that may impact our future results and performance include, but are not
limited to, those described in Item 1A, "Risk Factors" and in our other filings
with the Securities and Exchange Commission (“SEC”).




General




The
Partnership is a publicly held limited partnership formed under the California
Uniform Limited Partnership Act in November 1976.  The Partnership
raised $10,000,000 in gross proceeds by selling 20,000 units of limited
partnership interest ("Units") in an interstate offering, which commenced in
October 1977 and completed in January 1978.  The Partnership was
formed to engage in the business of developing and operating self-storage
facilities for personal and business use.




The
Partnership has reported annually to the SEC on Form 10-K which includes
financial statements certified by its independent registered public accounting
firm.  The Partnership has also reported quarterly to the SEC on Form
10-Q, which includes unaudited financial statements with such
filings.  The Partnership expects to continue such
reporting.  Upon written request, the Partnership will mail a copy of
its Annual Report on Form 10-K to the limited partners.




The
public may read and copy any materials this Partnership files with the SEC at
the SEC’s Public Reference Room at 450 Fifth Street, N.W., Washington, D.C.
20549.  The public may obtain information on the operation of the
Public Reference Room by calling the SEC at 1-800-732-0330.  The
Partnership does not maintain a website.  However, the SEC maintains
an Internet site that contains reports, proxy and information statements, and
other information regarding issuers, including the Partnership, that file
electronically with the SEC at http://www.sec.gov.




In 1995,
there were a series of mergers among Public Storage Management, Inc. (which was
the Partnership’s self-storage facilities operator), Public Storage, Inc. (which
was one of the Partnership’s general partners) and their affiliates
(collectively, “PSMI”), culminating in the November 16, 1995 merger (the “PSMI
Merger”) of PSMI into Storage Equities, Inc., a real estate investment trust
(“REIT”) organized as a California corporation.  In the PSMI Merger,
Storage Equities, Inc. was renamed Public Storage, Inc. and acquired
substantially all of PSMI’s United States (“U.S.”) real estate operations and
became a co-general partner of the Partnership and the operator of the
Partnership’s self-storage facilities.  Effective June 1, 2007,
Public Storage, Inc. was reorganized into Public Storage (“PS”), a Maryland real
estate investment trust.




The
Partnership's general partners are PS and B. Wayne Hughes ("Hughes")
(collectively referred to as the "General Partners").  Hughes has been
a general partner of the Partnership since its inception.  Hughes is
chairman of the board of PS, and was its chief executive officer through
November 7, 2002.  Hughes and members of his family (the “Hughes
Family”) own approximately 17.3% of the outstanding common shares of PS at March
16, 2010.  PS, Hughes, and affiliates also own limited partnership
interests, see Item 12 “Security Ownership of Certain Beneficial Owners and
Management and Related Stockholder Matters.”




The
Partnership is managed, and its investment decisions are made by Hughes and the
executive officers and trustees of PS.  The limited partners of the
Partnership have no right to participate in the operation or conduct of the
Partnership’s business and affairs.




3







The term
of the Partnership is until all properties have been sold and, in any event, not
later than December 31, 2035.




The Impact of Current
Economic Factors




The
recessionary trends experienced in 2008 and 2009, including the contraction in
economic activity and elevation in unemployment rates experienced in California
and the U.S., have had a negative impact upon the Partnership’s
business.




Operationally,
the Partnership’s occupancies and rental rates have come under pressure as
demand for self-storage space has softened.  The Partnership, through
its management agreement with PS (the “Management Agreement”), has responded by
reducing rental rates, increasing promotional discounts, and increasing its
marketing activities to stimulate additional demand for our storage
space.




Investment Objectives and
Policies




The
Partnership’s investment objectives are to (i) preserve and protect invested
capital, (ii) maximize the potential for appreciation in value of its
investments, and (iii) provide for cash distributions from
operations.




Following
are the Partnership’s investment practices and policies.  The
Partnership does not anticipate any new investments, other than maintenance
capital expenditures, and does not anticipate liquidating the real estate
investments it now holds.  While a vote of the limited partners is
generally required to change the Partnership’s investment policies, the general
partners hold a majority of the limited partnership units, and as a result, the
General Partners could change these policies through their vote.




●
            Our
      investments consist of nine self-storage facilities located in the
      U.S.  See “Self-Storage Facilities” below and Item 2
      “Properties” for further information.  These investments were
      acquired both for income and capital
gains.




●
            There
      is no limitation on the amount or percentage of assets, which can be
      invested in any specific person.




The
Partnership does not anticipate issuing senior securities, making loans to other
persons, investing in the securities of other issuers for the purpose of
exercising control, underwriting the securities of other issuers, engaging in
the purchase and sale of investments, offering securities in exchange for
property, or repurchasing or otherwise reacquiring its outstanding
securities.  The Partnership may consider borrowing money with the
intent of using the proceeds for distribution to partners.  There can
be no assurance that the Partnership would be able to access any such borrowings
at rates of interest the Partnership found attractive in order to do so, if such
a course of action were otherwise deemed necessary.




Self-Storage
Facilities




Self-storage
facilities are designed to offer accessible storage space for personal and
business use at a relatively low cost.  A user rents a fully enclosed
space, securing the space with their own lock, which is for the user's exclusive
use and to which only the user has access on an unrestricted basis during
business hours.  On-site operation is the responsibility of property
managers who are supervised by district managers.  Some self-storage
facilities also include rentable uncovered parking areas for vehicle
storage.  Storage facility spaces are rented on a month-to-month
basis.  Rental rates vary according to the location of the property,
the size of the storage space, and other characteristics that affect the
relative attractiveness of each particular space, such as whether the space has
drive-up access or its proximity to elevators.




Users of
space in self-storage facilities include individuals from virtually all
demographic groups, as well as businesses.  Individuals usually obtain
this space for storage of furniture, household appliances, personal belongings,
motor vehicles, boats, campers, motorcycles and other household
goods.  Businesses normally employ this space for storage of excess
inventory, business records, seasonal goods, equipment and
fixtures.




Self-storage
facilities in which the Partnership has invested generally consist of three to
seven buildings containing an aggregate of between approximately 250 to 1,100
storage spaces, most of which have between 25 and 400 square feet and an
interior height of approximately 8 to 12 feet.




4





The
Partnership's self-storage facilities are all in California and are generally
located in heavily populated areas and close to concentrations of apartment
complexes, single family residences and commercial
developments.  However, there may be circumstances in which it may be
appropriate to own a property in a less populated area, for example, in an area
that is highly visible from a major thoroughfare and close to, although not in,
a heavily populated area.  Moreover, in certain population centers,
land costs and zoning restrictions may create a demand for space in nearby less
populated areas.




As with
most other types of real estate, the conversion of self-storage facilities to
alternative uses in connection with a sale or otherwise would generally require
substantial investment.  However, the Partnership does not intend to
convert its self-storage facilities to other uses.




Operating
Strategies




The
Partnership’s self-storage facilities are operated by PS under the “Public
Storage” brand name, which the Partnership believes is the most recognized name
in the self-storage industry.  The major elements of the Partnership’s
operating strategies are as follows:




●
            Capitalize on recognition of
      the “Public Storage” name.  PS has more than 30 years of
      operating experience in the self-storage business.  PS has
      informed the Partnership that it is the largest self-storage facility
      operator in the U.S. in terms of both number of facilities and rentable
      space operated.  PS believes that its marketing and advertising
      programs improve its competitive position in the market.  The PS
      in-house yellow pages staff designs and places advertisements in
      directories in virtually all markets in which it
      operates.  Customers calling either the PS toll-free telephone
      referral system, (800) 44-STORE, or a self-storage facility are directed
      to the PS national telephone reservation system where a trained
      representative discusses with the customer space requirements, price and
      location preferences and also informs the customer of other products and
      services provided by PS and its subsidiaries.  The national
      telephone reservation system supports rental activity at all of the U.S.
      facilities operated by PS.  PS also provides customers the
      opportunity to review space availability and make reservations online
      through the PS website,
www.publicstorage.com.




●
            Maintain high occupancy levels
      and increase annual realized rents.  Subject to market
      conditions, the Partnership generally seeks to maximize revenues through
      the appropriate balance between occupancy, rental rates, and promotional
      discounting.  Average occupancy for the Partnership’s
      self-storage facilities was 90.6% in 2009 and 91.5% in
      2008.  Annual realized rents per occupied square foot decreased
      from $16.15 in 2008 to $15.63 in
2009.




●
            Systems and
      controls.  PS has an organizational structure and a
      property operation system which links its corporate office with each of
      its self-storage facilities.  This enables PS to obtain daily
      information from each facility and to achieve efficiencies in operations
      and maintain control over its space inventory, rental rates, promotional
      discounts and delinquencies, and to identify changing market conditions
      and operating trends as well as analyze customer data, and quickly change
      properties’ pricing and promotional mix on an automated
      basis.  Expense management is achieved through centralized
      payroll and accounts payable systems and a comprehensive property tax
      appeals department. PS also has an extensive internal audit program
      designed to ensure adherence to specified policies and procedures, and
      thereby ensure proper handling of cash
  collections.




●
            Professional property
      operations.  There are approximately 4,900 persons who
      render services for the Public Storage system in the U.S., primarily
      personnel engaged in property operations, substantially all of whom are
      employed by a clearing company that provides certain administrative and
      cost-sharing services to PS and other owners of properties operated by
      PS.




Property
Operator




The
Partnership’s self-storage facilities are managed by PS pursuant to the
Management Agreement.




Under the
supervision of the Partnership, PS coordinates the operation of the facilities,
establishes rental policies and rates, directs marketing activity and directs
the purchase of equipment and supplies, maintenance activity and the selection
and engagement of all vendors, suppliers and independent
contractors.




PS
engages, at the expense of the Partnership, employees for the operation of the
Partnership's facilities, including property managers, assistant managers,
relief managers, and billing and maintenance personnel.  Some or all
of these employees may be employed on a part-time basis and may also be employed
by other persons, partnerships, real estate investment trusts or other entities
owning facilities operated by PS.




5







In the
purchasing of services such as advertising (including broadcast media
advertising) and insurance, PS attempts to achieve economies-of-scale by
combining the resources of the various facilities that it
operates.  Facilities operated by PS have historically carried
comprehensive insurance, including fire, earthquake, liability and extended
coverage.




PS has
systems for managing space inventories, accounting and handling delinquent
accounts, including a computerized network linking PS operated
facilities.  Property managers are trained in detailed operating
procedures.




The
Partnership's facilities are typically advertised via signage, yellow pages,
flyers, broadcast media advertising (i.e. television and radio) in geographic
areas in which many of the Partnership's facilities are located, as well as on
the Internet.  Broadcast media and other advertising costs are charged
to the Partnership's facilities located in geographic areas affected by the
advertising.




Under the
supervision of the Partnership, PS seeks to increase the cash flow generated by
the Partnership’s facilities by: a) regularly evaluating call volume,
reservation activity, and move-in/move-out rates for each property relative to
marketing activities, b) evaluating market supply and demand factors, and based
upon these analyses, adjusting the marketing activities and rental rates, c)
attempting to maximize revenues through evaluating the appropriate balance
between occupancy, rental rates, and promotional discounting, and d) controlling
expense levels.




Under the
Management Agreement, the Partnership pays PS a flat fee of 6% of the gross
revenues of the self-storage facilities operated for the
Partnership.  For as long as the Management Agreement between the
Partnership and PS is in effect, PS has granted the Partnership a non-exclusive
license to use two PS service marks and related designs including the "Public
Storage" name in conjunction with rental and operation of facilities managed
pursuant to the Management Agreement.  Upon termination of the
Management Agreement, the Partnership would no longer have the right to use the
service marks and related designs.  The General Partners believe that
the loss of the right to use the service marks and related designs could have a
material adverse effect on the Partnership’s business.




The
Management Agreement between the Partnership and PS provides that the Management
Agreement may be terminated without cause upon 60 days written notice by the
Partnership or six months notice by PS.




Competition




Self-storage
facilities generally draw customers from residents within a three to five mile
radius.  Many of the Partnership’s facilities operate within three to
five miles of well-located and well-managed competitors (including those
facilities owned by PS) that seek the same group of customers through many of
the same marketing channels that PS uses in managing our facilities, including
yellow page advertising, Internet advertising, as well as signage and
banners.  As a result, competition is significant and affects the
occupancy levels, rental rates, rental income and operating expenses of our
facilities.  Any increase in availability of funds for investment in
real estate may accelerate competition.  The Partnership believes that
the significant operating and financial experience of PS, and the “Public
Storage” brand name recognition should enable the Partnership to continue to
compete effectively with other entities.




Other Business
Activities




PS owns a
corporation that reinsures policies issued to the Partnership’s tenants against
lost or damaged goods stored by tenants in the Partnership’s self-storage
facilities.  We believe that the availability of insurance reduces our
potential liability to tenants for losses to their goods from theft or
destruction.  This corporation receives the premiums and bears the
risks associated with the reinsurance.  The Partnership receives a fee
(an “Access Fee”) from this corporation in return for providing tenant
listings.  This Access Fee is based on the number of spaces the
Partnership has to rent.




A
subsidiary of PS sells locks and boxes to the general public and tenants
associated with securing their spaces and storing and moving their
goods.  The subsidiary of PS receives the revenues and bears the cost
of the activities.  We believe these activities, along with
availability of insurance as noted above, supplement and strengthen the
Partnership’s existing self-storage business by further meeting the needs of
storage customers.




Federal Income
Tax




Public
Storage Properties, Ltd. is treated as a partnership for federal and state
income tax purposes with the taxable income of the entity allocated to each
partner in accordance with the partnership agreement.  Accordingly, no
federal income tax expense is recorded by the Partnership.




6







Employees




The
Partnership has no direct employees.  There are approximately 28
persons who render services on behalf of the Partnership.  These
persons include resident managers, assistant managers, relief managers, area
managers, and administrative and maintenance personnel.  Some
employees may be employed on a part-time basis and may be employed by other
persons, partnerships or other entities owning facilities operated by
PS.




Seasonality




The
Partnership experiences minor seasonal fluctuations in the occupancy levels of
its self-storage facilities with occupancies higher in the summer months than in
the winter months.  The Partnership believes that these fluctuations
result in part from increased moving activity during the summer
months.




ITEM
1A.                      Risk
Factors




In
addition to the other information in our Annual Report on Form 10-K, you should
consider the risks described below that we believe may be material to investors
in evaluating the Partnership.  This section contains forward-looking
statements, and in considering these statements, you should refer to the
qualifications and limitations on our forward-looking statements that are
described in Forward
Looking Statements at the beginning of Item 1.




The
General Partners control the Partnership as a group.




Public
Storage is a general partner and beneficially owns approximately 31.4% of our
outstanding limited partnership units.  In addition, B. Wayne Hughes,
General Partner of the Partnership, and Chairman of PS and members of his family
beneficially own 31.0% of the limited partnership units.  As a result,
the General Partners, as a group, control matters submitted to a vote of our
unitholders, including amending our organizational documents, dissolving the
Partnership and approving other such transactions.




Since
our business consists primarily of operating real estate, we are subject to the
risks related to the ownership and operation of real estate that can adversely
impact our business and financial condition.




The value of our investments may be
reduced by general risks of real estate ownership.  Since we
derive substantially all of our income from real estate operations, we are
subject to the general risks of acquiring and owning real estate-related assets,
including:




●
            lack
      of demand for rental spaces or units in a
  locale;




●
            changes
      in general economic or local
conditions;




●
            natural
      disasters, such as earthquakes and floods; which could exceed the
      aggregate limits of our insurance
coverage;




●
            potential
      terrorist attacks;




●
            changes
      in supply of or demand for similar or competing facilities in an
      area;




●
            the
      impact of environmental protection
laws;




●
            changes
      in interest rates and availability of permanent mortgage funds which may
      render the sale or financing of a nonstrategic property difficult or
      unattractive including the impact of the current turmoil in the credit
      markets;




●
            increases
      in insurance premiums, property tax assessments and other operating and
      maintenance expenses;




●
            adverse
      changes in tax, real estate and zoning laws and regulations;
      and




●
            tenant
      and employment-related claims.




7




In
addition, we self-insure certain of our property loss, liability, and workers
compensation risks for which other real estate companies may use third-party
insurers.  This results in a higher risk of losses that are not
covered by third-party insurance contracts.




There is significant competition
among self-storage facilities and from other storage
alternatives.All of our properties are self-storage
facilities, which generated substantially all of our revenue for the year ended
December 31, 2009.  Local market conditions will play a significant
part in how competition will affect us. Competition in the market areas in which
many of our properties are located from other self-storage facilities and other
storage alternatives is significant and has affected the occupancy levels,
rental rates and operating expenses of some of our properties.  Any
increase in availability of funds for investment in real estate may accelerate
competition.  Further development of self-storage facilities may
intensify competition among operators of self-storage facilities in the market
areas in which we operate.




We may incur significant
environmental costs and liabilities.As an owner and operator
of real properties, under various federal, state and local environmental laws,
we are required to clean up spills or other releases of hazardous or toxic
substances on or from our properties.  Certain environmental laws
impose liability whether or not the owner knew of, or was responsible for, the
presence of the hazardous or toxic substances. In some cases, liability may not
be limited to the value of the property.  The presence of these
substances, or the failure to properly remediate any resulting contamination,
whether from environmental or microbial issues, also may adversely affect the
owner’s or operator’s ability to sell, lease or operate its property or to
borrow using its property as collateral.




We have
conducted preliminary environmental assessments on the Partnership’s properties
to evaluate the environmental condition of, and potential environmental
liabilities associated with, our properties.  These assessments
generally consist of an investigation of environmental conditions at the
property (not including soil or groundwater sampling or analysis), as well as a
review of available information regarding the site and publicly available data
regarding conditions at other sites in the vicinity.  In connection
with these property assessments, we have become aware that prior operations or
activities at some facilities or from nearby locations have or may have resulted
in contamination to the soil or groundwater at these facilities.  In
this regard, some of our facilities are or may be the subject of federal or
state environmental investigations or remedial actions.  Although we
cannot provide any assurance, based on the preliminary environmental
assessments, we believe we have funds available to cover any liability from
environmental contamination or potential contamination and we are not aware of
any environmental contamination of our facilities material to our overall
business, financial condition or results of operations.




There has
been an increasing number of claims and litigation against owners and managers
of rental properties relating to moisture infiltration, which can result in mold
or other property damage.  When we receive a complaint concerning
moisture infiltration, condensation or mold problems and/or become aware that an
air quality concern exists, we implement corrective measures in accordance with
guidelines and protocols we have developed with the assistance of outside
experts.  We seek to work proactively with our tenants to resolve
moisture infiltration and mold-related issues, subject to our contractual
limitations on liability for such claims.  However, we can give no
assurance that material legal claims relating to moisture infiltration and the
presence of, or exposure to, mold will not arise in the future.




Property taxes can increase and
cause a decline in yields on investments.  Each of our
properties is subject to real property taxes.  These property taxes
may increase in the future as property tax rates change and as our properties
are assessed or reassessed by tax authorities.  Our properties are
located in California and we believe that they are assessed at levels that are
significantly below current fair values, due to longstanding laws that generally
limit assessment increases if there is no change in ownership or new
construction.  Recent shortfalls in tax revenues of local governments
may cause pressure to increase tax rates, assessment levels, or eliminate the
longstanding limits on assessment increases and limits on tax
rates.  In addition, changes in ownership, either direct or indirect
(such as by transfers of partnership interests), could trigger a California
reassessment.  Any such increases could adversely impact our
profitability.




We must comply with the Americans
with Disabilities Act and fire and safety regulations, which can require
significant expenditures.All our properties must comply with the
Americans with Disabilities Act and with related regulations (the
“ADA”).  The ADA has separate compliance requirements for “public
accommodations” and “commercial facilities,” but generally requires that
buildings be made accessible to persons with disabilities.  Various
state laws impose similar requirements.  A failure to comply with the
ADA or similar state laws could result in government imposed fines on us and
could award damages to individuals affected by the failure.  In
addition, we must operate our properties in compliance with numerous local fire
and safety regulations, building codes, and other land use
regulations.  Compliance with these requirements can require us to
spend substantial amounts of money, which would reduce cash otherwise available
for




8







distribution
to shareholders.  Failure to comply with these requirements could also
affect the marketability of our real estate facilities.




We incur liability from tenant and
employment-related claims.From time to time we must resolve
tenant claims and employment-related claims by corporate level and field
personnel.




Public
Storage’s acquisitions or development of properties may subject the Partnership
to additional risks.




Public
Storage has historically been an acquirer and developer of real estate
facilities, most recently acquiring 646 self-storage facilities located in the
U.S. in 2006 with its acquisition of Shurgard Storage Centers.  Such
acquisitions or newly developed facilities do not change the financial interests
of the Partnership.  However, individual Partnership properties may
experience a decrease in move-ins, reductions to rental rates, increases to
promotional discounts, or other negative impacts to revenues in the short and/or
long-term due to the competitive impact of Public Storage management of the
newly acquired or developed facilities, particularly with respect to those
facilities that are close to the Partnership’s facilities.




Global
economic conditions could adversely affect our business, financial condition,
growth and access to capital.




There
continues to be global economic uncertainty, elevated levels of unemployment,
reduced levels of economic activity, and it is uncertain as to when economic
conditions will improve.  These negative economic conditions in the
markets where we operate facilities, and other events or factors that adversely
affect disposable income of the consumer, have and are likely to continue to
adversely affect our business.




As a
further result of the current global financial crisis, our ability to borrow at
reasonable rates may be adversely affected by challenging credit markets
conditions.  While we currently believe that we have sufficient
working capital and cash flow from operations to continue to operate our
business as usual, long-term continued turbulence in the credit markets and in
the national economy may adversely affect our access to capital.




We
have become increasingly dependent upon automated processes, telecommunications,
and the Internet and are faced with system security risks.




We have
become increasingly centralized and dependent upon automated information
technology processes, and certain critical components of our operating systems
are dependent upon third party providers.  As a result, we could be
severely impacted by a catastrophic occurrence, such as a natural disaster or a
terrorist attack, or a circumstance that disrupted operations at our third party
providers.  Even though we believe we utilize appropriate duplication
and back-up procedures, a significant outage in our third party providers could
negatively impact our operations.  In addition, a portion of our
business operations are conducted over the Internet, increasing the risk of
viruses that could cause system failures and disruptions of
operations.  Experienced computer programmers may be able to penetrate
our network security and misappropriate our confidential information, create
system disruptions or cause shutdowns.  Nearly half of our move-ins
comes from sales channels dependent upon telecommunications (telephone or
Internet).




We
are subject to laws and governmental regulations and actions that affect our
operating results and financial condition.




Our
business is subject to regulation under a wide variety of U.S. federal, state
and local laws, regulations and policies including those imposed by the SEC and
the Sarbanes-Oxley Act of 2002, as well as applicable labor
laws.  Although we have policies and procedures designed to comply
with applicable laws and regulations, failure to comply with the various laws
and regulations may result in civil and criminal liability, fines and penalties,
increased costs of compliance and restatement of our financial
statements.




There can
also be no assurance that, in response to current economic conditions or the
current political environment or otherwise, laws and regulations will not be
implemented or changed in ways that adversely affect our operating results and
financial condition, such as current federal legislative proposals to expand
health care coverage costs or facilitate union activity or otherwise increase
operating costs.




9





Terrorist
attacks and the possibility of wider armed conflict may have an adverse impact
on our business and operating results and could decrease the value of our
assets.




Terrorist
attacks and other acts of violence or war could have a material adverse impact
on our business and operating results.  There can be no assurance that
there will not be further terrorist attacks against the U.S.  Attacks
or armed conflicts that directly impact one or more of our properties could
significantly affect our ability to operate those properties and thereby impair
our operating results.  Further, we may not have insurance coverage
for losses caused by a terrorist attack.  Such insurance may not be
available, or if it is available and we decide to obtain such terrorist
coverage, the cost for the insurance may be significant in relationship to the
risk overall.  In addition, the adverse effects that such violent acts
and threats of future attacks could have on the U.S. economy could similarly
have a material adverse effect on our business and results of
operations.  Finally, further terrorist acts could cause the U.S. to
enter into a wider armed conflict, which could further impact our business and
operating results.




Increases
in interest rates may adversely affect the price of our partnership
units.




One of
the factors that influence the market price of our partnership units is the
annual rate of distributions that we pay on the securities, as compared with
interest rates.  An increase in interest rates may lead purchasers of
partnership units to demand higher annual distribution rates, which could
adversely affect the market price of our partnership units.




Our
ownership interest in STOR-Re may lose value or become a liability.




The
Partnership has a 0.9% ownership interest in STOR-Re Mutual Insurance
Corporation (“STOR-Re”), which was formed in 1994 as an association captive
insurance company, and is controlled by PS.  STOR-Re provided limited
property and liability insurance coverage to the Partnership, PS, and affiliates
of PS for losses occurring prior to April 1, 2004.  Liabilities for
losses and loss adjustment expenses include an amount determined from loss
reports and individual cases and an amount, based on recommendations from an
outside actuary that is a member of the American Academy of Actuaries, using a
frequency and severity method, for losses incurred but not
reported.  Determining the liability for unpaid losses and loss
adjustment expense is based upon estimates and while we believe that the amount
is adequate, the ultimate loss may be in excess of or less than the amounts
provided, which may result in a reduction in the value of the Partnership’s
investment or could result in future payments to STOR-Re if its reserves were
determined to be inadequate.  Financial data with respect to STOR-Re
is included in Note 5 to the Partnership’s December 31, 2009 financial
statements.




Developments
in California may have an adverse impact on our business and financial
results.




The state
of California and many local jurisdictions are facing severe budgetary problems
and deficits.  Action that may be taken in response to these problems,
such as increases in property taxes on commercial properties, changes to sales
taxes, adoption of a proposed “Business Net Receipts Tax” or other governmental
efforts to raise revenues could adversely impact our business and results of
operations.  In addition, we could be adversely impacted by efforts to
reenact legislation mandating medical insurance for employees of California
businesses and members of their families.






ITEM
1B.                      Unresolved Staff
Comments




Not
applicable.




10




ITEM
2.                      Properties




The
following table sets forth information as of December 31, 2009 about properties
owned by the Partnership:




Location
            
            Size
      of Parcel
            
            Net
                Rentable
      Area
            
            Number
                of
      Spaces
            
            Date
                of
      Purchase
            
            Completion
                DateCaliforniaCorona
            
            2.82
      acres
            
            52,000
      sq. ft.
            
            465
            
            
            June
      29, 1978
            
            Dec.
      1978Fremont
            
            3.00
      acres
            
            53,000
      sq. ft.
            
            455
            
            
            Mar.
      21, 1978
            
            Nov.
      1978Milpitas
            
            3.40
      acres
            
            39,000
      sq. ft.
            
            419
            
            
            May
      8, 1978
            
            Nov.
      1978Norco
            
            1.66
      acres
            
            29,000
      sq. ft.
            
            258
            
            
            July
      19, 1978
            
            Dec.
      1978North
      Hollywood
            
            2.06
      acres
            
            38,000
      sq. ft.
            
            342
            
            
            Mar.
      17, 1978
            
            Dec.
      1979Pasadena
            
            1.84
      acres
            
            37,000
      sq. ft.
            
            386
            
            
            Feb.
      24, 1978
            
            Aug.
      1978Sun
      Valley
            
            2.72
      acres
            
            53,000
      sq. ft.
            
            477
            
            
            May
      30, 1978
            
            Oct.
      1978Wilmington
            
            6.32
      acres
            
            133,000
      sq. ft.
            
            1,087
            
            
            Apr.
      18, 1978
            
            Aug.
      1978Whittier
      - El Monte
            
            3.28
      acres
            
            58,000
      sq. ft.
            
            537
            
            
            Nov.
      29, 1977
            
            July
      1978




For the
year ended December 31, 2009, the weighted average occupancy level and the
average realized rent per occupied square foot for our self-storage facilities
were approximately 90.6% and $15.63, respectively.




The
Partnership does not have any agreements to buy or sell any real
estate.  The Partnership does not anticipate any new investments,
other than maintenance capital expenditures, and does not anticipate liquidating
the real estate investments it now holds.




As of
December 31, 2009, none of the properties were encumbered by mortgage
debt.






ITEM
3.                      Legal
Proceedings




Brinkley v. Public Storage,
Inc. (filed April 2005) (Superior Court of California – Los Angeles
County)




The
plaintiff sued PS on behalf of a purported class of California non-exempt
employees based on various California wage and hour laws.  Plaintiff
sought certification for alleged meal period violations, rest period violations,
failure to pay for travel time, failure to pay for mileage reimbursement, and
for wage statement violations.  The Court certified subclasses based
only on alleged meal period and wage statement violations.  In June
2007, the Court granted PS’ summary judgment motion as to the causes of action
relating to the subclasses certified and dismissed those
claims.  Plaintiff appealed.  The Court of Appeals sustained
the dismissal.  The California Supreme Court granted review but
deferred the matter pending disposition of a related issue in another
case.




Other
Items




PS and
the Partnership are a party to various claims, complaints, and other legal
actions that have arisen in the normal course of business from time to time,
that are not described above.  We believe that it is unlikely that the
outcome of these other pending legal proceedings including employment and tenant
claims, in the aggregate, will have a material adverse effect upon the
Partnership’s operations or financial position.




11


PART
II






ITEM
5.                      Market for the Registrant's
Common Equity, Related Stockholder Matters and Issuer Purchases ofEquity
Securities




The
Partnership has no common stock.




The Units
are not listed on any national securities exchange or quoted on the NASDAQ
System and there is no established public trading market for the
Units.  Secondary sales activity for the Units has been limited and
sporadic.  The General Partners monitor transfers of the Units (a)
because the admission of the transferee as a substitute limited partner requires
the consent of the General Partners under the Partnership's Amended and Restated
Certificate and Agreement of Limited Partnership, (b) in order to ensure
compliance with safe harbor provisions to avoid treatment as a "publicly-traded
partnership" for tax purposes, and (c) because the General Partners (and their
affiliates) have purchased Units.  However, the General Partners do
not have first hand information regarding the prices at which secondary sale
transactions in the Units have been effectuated.  Various
organizations offer to purchase and sell limited partnership interests
(including securities of the type such as the Units) in secondary sales
transactions.  Various publications such as The Stanger Report
summarize and report information (on a monthly, bimonthly or less frequent
basis) regarding secondary sales transactions in limited partnership interests
(including the Units), including the prices at which such secondary sales
transactions are effectuated.




Exclusive
of the General Partners' interest in the Partnership, as of December 31, 2009,
there were approximately 587 unitholders of record.




Distributions
to the general and limited partners of all cash available for distribution (as
defined) are made quarterly.  Cash available for distribution is
generally net cash provided by operating activities, less deductions to pay,
establish or revise reserves for all other expenses (other than incentive
distributions to the general partner) and capital improvements, plus net
proceeds from any sale or financing of the Partnership's
properties.




Reference
is made to Items 6 and 7 hereof for information on the amount of such
distributions.






ITEM
6.                      Selected Financial
Data




For
      the Year Ended December 31,2009
              
              
              2008
              
              
              2007
              
              
              2006
              
              
              2005Revenues
              
              $
              7,505,000
              
              
              $
              7,872,000
              
              
              $
              7,524,000
              
              
              $
              7,371,000
              
              
              $
              7,002,000Depreciation
              
              
              147,000
              
              
              
              142,000
              
              
              
              130,000
              
              
              
              165,000
              
              
              
              181,000Net
      income
              
              
              5,386,000
              
              
              
              5,649,000
              
              
              
              5,314,000
              
              
              
              5,042,000
              
              
              
              4,888,000Limited
      partners' share
              
              
              4,059,000
              
              
              
              4,266,000
              
              
              
              3,701,000
              
              
              
              3,751,000
              
              
              
              3,619,000General
      partners' share
              
              
              1,327,000
              
              
              
              1,383,000
              
              
              
              1,613,000
              
              
              
              1,291,000
              
              
              
              1,269,000Limited Partners' Per Unit Data
      (1):Net
      income
              
              $
              202.95
              
              
              $
              213.30
              
              
              $
              185.05
              
              
              $
              187.55
              
              
              $
              180.95Cash
      distributions
              
              $
              191.00
              
              
              $
              199.00
              
              
              $
              234.00
              
              
              $
              186.00
              
              
              $
              183.00Balance Sheet Data:Cash
      and cash equivalents
              
              $
              422,000
              
              
              $
              802,000
              
              
              $
              559,000
              
              
              $
              1,483,000
              
              
              $
              1,448,000Total
      assets
              
              $
              4,280,000
              
              
              $
              4,089,000
              
              
              $
              3,745,000
              
              
              $
              4,720,000
              
              
              $
              4,682,000


(1)
            Per
      unit data is based on the weighted average number of the limited
      partnership units (20,000) outstanding during each
  period.


12




ITEM
7.                      Management's Discussion and
Analysis of Financial Condition and Results of Operations




The
following discussion and analysis should be read in conjunction with the
Partnership’s financial statements and notes thereto.




Forward Looking
Statements




This
Annual Report on Form 10-K contains forward-looking statements within the
meaning of the federal securities laws.  All statements in this
document, other than statements of historical fact, are forward-looking
statements which may be identified by the use of the words
"expects,"   "believes,"  
"anticipates,"  "plans," "would," "should," "may," "estimates"
and similar expressions.  These forward-looking statements involve
known and unknown risks and uncertainties, which may cause Public Storage
Properties, Ltd.’s (the “Partnership”) actual results and performance to be
materially different from those expressed or implied in the forward-looking
statements.  As a result, you should not rely on any forward-looking
statements in this report, or which management may make orally or in writing
from time to time, as predictions of future events nor guarantees of future
performance.  We caution you not to place undue reliance on
forward-looking statements, which speak only as the date of this report or as of
the dates indicated in the statements.  All of our forward-looking
statements, including those in this report, are qualified in their entirety by
this statement.  We expressly disclaim any obligation to update
publicly or otherwise revise any forward-looking statements, whether as a result
of new information, new estimates, or other factors, events or circumstances
after the date of this document, except where expressly required by
law.  Accordingly, you should use caution in relying on past
forward-looking statements to anticipate future results.




Factors
and risks that may impact our future results and performance include, but are
not limited to, those described in Item 1A, "Risk Factors" and in our other
filings with the Securities and Exchange Commission (“SEC”).




Critical Accounting
Policies




Management’s
Discussion and Analysis of Financial Condition and Results of Operations
discusses our financial statements, which have been prepared in accordance with
United States (“U.S.”) generally accepted accounting principles
(“GAAP”).  The preparation of our financial statements and related
disclosures in conformity with GAAP and our discussion and analysis of our
financial condition and results of operations requires management to make
judgments, assumptions and estimates that affect the amounts reported in our
financial statements and accompanying notes.  The notes to the
Partnership’s December 31, 2009 financial statements, primarily Note 2,
summarize the significant accounting policies and methods used in the
preparation of our financial statements and related disclosures.




Management
believes the following are critical accounting policies, the application of
which has a material impact on the Partnership’s financial
presentation.  That is, they are both important to the portrayal of
our financial condition and results, and they require management to make
judgments and estimates about matters that are inherently
uncertain.




Impairment of Real Estate:Substantially all of our assets consist of real estate.  On a
quarterly basis, we evaluate our real estate for impairment.  The
evaluation of real estate for impairment includes determining whether indicators
of impairment exist, which is a subjective process.  When any
indicators of impairment are found, the evaluation then entails projections of
future operating cash flows, which also involves significant
judgment.  We identified no such impairments at December 31,
2009.  However, future events, or facts and circumstances that
currently exist, that we have not yet identified, could cause us to conclude in
the future that our real estate is impaired.  Any resulting impairment
loss could have a material adverse impact on the Partnership’s financial
condition and results of operations.




Estimated Useful Lives of Long-Lived
Assets:Substantially all of our assets consist of depreciable,
long-lived assets.  We record depreciation expense with respect to
these assets based upon their estimated useful lives.  Any change in
the estimated useful lives of those assets, caused by functional or economic
obsolescence or other factors, could have a material adverse impact on our
financial condition or results of operations.




13





Accruals for Contingencies:We
are exposed to business and legal liability risks with respect to events that
have occurred, but in accordance with GAAP, we have not accrued for certain
potential liabilities because the loss is either not probable or not estimable
or because we are not aware of the event.  Future events and the
results of pending litigation could result in such potential losses becoming
probable and estimable, which could have a material, adverse impact on our
financial condition or results of operations.  Significant unaccrued
losses that we have determined are at least reasonably possible are described in
Notes 5 and 8 to the Partnership’s December 31, 2009 financial
statements.




Accruals for Operating
Expenses: We accrue for property tax expense and other operating expenses
based upon estimates and historical trends and current and anticipated local and
state government rules and regulations.  If these estimates and
assumptions are incorrect, our expenses could be misstated.




Overview of Management’s
Discussion and Analysis of Operations




The
self-storage industry is highly fragmented and is composed predominantly of
numerous local and regional operators.  Competition in the markets in
which we operate is significant and has increased over the past several years
due to additional development of self-storage facilities.  We believe
that the increase in competition has had a negative impact on the Partnership’s
occupancy levels and rental rates in many markets.  However, we
believe that the Partnership’s affiliation with Public Storage (“PS”) provides
several distinguishing characteristics that enable the Partnership to compete
effectively with other owners and operators.




PS is the
largest owner and operator of self-storage facilities in the U.S.  All
of the PS facilities in the U.S. are operated under the “Public Storage” brand
name, which we believe is the most recognized and established name in the
self-storage industry.  The concentration of most of the PS and
Partnership properties in major metropolitan centers makes various promotional
and media programs, such as television, yellow pages, and Internet keyword
bidding, far more economical for us than for our competitors.




The
self-storage industry is subject to general economic conditions, particularly
those that affect the disposable income and spending of consumers, as well as
those that affect moving trends.  Due to the recessionary pressures in
the U.S., demand for self-storage space was soft in 2009 and continues to be
soft.  As a result, we are experiencing downward pressure on occupancy
levels, rental rates, and revenues in our self-storage facilities.




We will
continue to focus our growth strategies on improving the operating performance
of our existing self-storage properties primarily through increases in revenues
achieved through the national telephone reservation system and associated
marketing efforts.  We expect any potential future increases in rental
income to come primarily from increases in realized rent rather than increases
in occupancy, although there can be no assurance that we will experience such
increases.




Results of
Operations




Year
ended December 31, 2009 as compared to year ended December 31,
2008:




The
Partnership's net income for 2009 was $5,386,000, as compared to $5,649,000 for
2008, representing a decrease of $263,000 or 4.7%.  Property net
operating income (rental income less cost of operations, management fees paid to
an affiliate and depreciation expense) decreased $228,000 or 4.1% from
$5,496,000 in 2008 to $5,268,000 in 2009.




Rental
income for 2009 was $7,302,000, as compared to $7,621,000 for 2008, representing
a decrease of $319,000 or 4.2%.  The decrease in rental income was
primarily a result of a 3.2% decrease in realized rent per square
foot.  Annual realized rent for 2009 decreased to $15.63 per occupied
square foot, as compared to $16.15 per occupied square foot for
2008.  Weighted average occupancy levels at the self-storage
facilities were 90.6% and 91.5% for 2009 and 2008, respectively.




We
believe that demand for self-storage space has been negatively impacted by
general economic conditions, the slowdown in housing sales and moving activity,
as well as increased competition.  Based upon certain comparative
December 31, 2009 key operating metrics for the Partnership’s self-storage
facilities including a 1.9% decline in square foot occupancy from 90.3% at
December 31, 2008 to 88.6% at December 31, 2009, and 4.5% lower in place annual
rent per occupied square foot from $17.42 at December 31, 2008 to $16.64 at
December 31, 2009, we expect that the revenue will decline for the Partnership’s
facilities for the three months ending March 31, 2010, as compared to the
same period in 2009.  In place annual rent per occupied square foot
represents annualized contractual rents per occupied square foot without
reductions for promotional discounts and excludes late charges and
administrative fees.  The Partnership’s operating strategy will
be to continue to focus on maintaining occupancy levels by adjusting rental
rates, promotional discounts and marketing activities.  It is unclear
to us how much the above mentioned factors will impact our revenues beyond the
first quarter of 2010.




14




Other
income was $203,000 for 2009, as compared to $251,000 for 2008, representing a
decrease of $48,000 or 19.1%.  Included in other income on our
statements of income are access fees paid by PS Insurance Company - Hawaii, Ltd.
(“PSICH”), a corporation owned by PS (described more fully in Note 5 to the
Partnership’s December 31, 2009 financial statements), totaling $196,000 and
$215,000 for 2009 and 2008, respectively.  The decline is due to
adjustments in timing of the recording of income in 2008 due to changes in
accounting estimates.  Interest income on cash balances for 2009
declined as compared to 2008 due to significant decreases in average interest
rates.  The Partnership has $422,000 in cash on hand at December 31,
2009 invested primarily in money-market funds, which earn nominal rates of
interest in the current interest rate environment.




Cost of
operations, including management fees paid to an affiliate, (see Note 5 to the
Partnership’s December 31, 2009 financial statements) for 2009 was
$1,887,000 compared to $1,983,000 for 2008, representing a decrease of $96,000
or 4.8%, as decreases in repairs and maintenance, utilities, payroll and
management fee expenses, were partially offset by increases in advertising and
promotion and property taxes expenses.




Depreciation
expense was $147,000 and $142,000 for 2009 and 2008, respectively, representing
an increase of $5,000 or 3.5%.  The increase in depreciation expense
is primarily related to additional capital improvements.




Administrative
expense was $85,000 and $98,000 in 2009 and 2008, respectively, representing a
decrease of $13,000, or 13.3%.  This decrease is attributable to legal
fees incurred in 2008 related to a proposed property condemnation which is no
longer under consideration.




Year
ended December 31, 2008 as compared to year ended December 31,
2007:




The
Partnership's net income for 2008 was $5,649,000, as compared to $5,314,000 for
2007, representing an increase of $335,000 or 6.3%.  Property net
operating income (rental income less cost of operations, management fees paid to
an affiliate and depreciation expense) increased $279,000 or 5.3% from
$5,217,000 in 2007 to $5,496,000 in 2008.




Rental
income for 2008 was $7,621,000, as compared to $7,341,000 for 2007, representing
an increase of $280,000 or 3.8%.  The increase in rental income was a
result of improvements in realized rent per square foot.  Annual
realized rent for 2008 increased to $16.15 per occupied square foot, as compared
to $15.79 per occupied square foot for 2007.  Weighted average
occupancy levels at the self-storage facilities were 91.5% and 90.3% for 2008
and 2007, respectively.




Other
income was $251,000 for 2008, as compared to $183,000 for 2007, representing an
increase of $68,000 or 37.2%.  Included in other income for
2008 are additional access fees paid by PSICH totaling $34,000 for amounts
earned in 2007.  These additional access fees were paid in 2008 as a
result of a change in PSICH’s accounting estimates which determine such
fees.  Included in other income on our statements of income are access
fees totaling $215,000 (which includes the $34,000 for amounts earned in 2007)
and $104,000 for 2008 and 2007, respectively.




Cost of
operations, including management fees paid to an affiliate, (see Note 5 to the
Partnership’s December 31, 2009 financial statements) for 2008 was
$1,983,000 compared to $1,994,000 for 2007, representing a decrease of $11,000
or 0.6%, as reductions in advertising and promotion, insurance and office
expenses, were mostly offset by increases in utilities, payroll, repairs and
maintenance, property taxes and management fee expenses.




Depreciation
expense was $142,000 and $130,000 for 2008 and 2007, respectively, representing
an increase of $12,000 or 9.2%.  The increase in depreciation expense
is primarily related to additional capital improvements.




Administrative
expense was $98,000 and $86,000 in 2008 and 2007, respectively, representing an
increase of $12,000, or 14.0%.  This increase is attributable to legal
fees totaling $13,000 incurred in 2008 related to a proposed property
condemnation.




15





Liquidity and Capital
Resources




At
December 31, 2009, the Partnership had cash of $422,000 as compared to total
liabilities of $276,000.  Cash generated from operations ($4,936,000
for the year ended December 31, 2009) has been sufficient to meet all current
obligations of the Partnership.  Capital improvements totaled $171,000
in 2009, $247,000 in 2008 and $113,000 in 2007.  Capital improvements
are budgeted at $58,000 for 2010.




As of
December 31, 2009, the Partnership had $559,000 in amounts due from
affiliates.  These amounts arose in December 2009 from the timing of
the settlement of shared costs and were collected in January 2010.




The
Partnership does not anticipate issuing senior securities, making loans to other
persons, investing in the securities of other issuers for the purpose of
exercising control, underwriting the securities of other issuers, engaging in
the purchase and sale of investments, offering securities in exchange for
property, or repurchasing or otherwise reacquiring its outstanding
securities.  The Partnership may consider borrowing money with the
intent of using the proceeds for distribution to partners.  There can
be no assurance that the Partnership would be able to access any such borrowings
at rates of interest the Partnership found attractive in order to do so, if such
a course of action were otherwise deemed necessary.




Distributions




The
Partnership Agreement requires that cash available for distribution (cash flow
from all sources less cash necessary for any obligations or capital improvement
needs) be distributed at least quarterly.  During the year ended
December 31, 2009, we paid distributions to the limited and general partners
totaling $3,820,000 ($191.00 per unit) and $1,325,000,
respectively.  During the year ended December 31, 2008, we paid
distributions to the limited and general partners totaling $3,980,000 ($199.00
per unit) and $1,380,000, respectively.  During the year ended
December 31, 2007, we paid distributions to the limited and general partners
totaling $4,680,000 ($234.00 per unit) and $1,623,000,
respectively.  Future distribution rates will be adjusted to levels
which are supported by operating cash flow after provisions for capital
improvements and any other necessary obligations.





ITEM
7A.                   Quantitative and Qualitative
Disclosures about Market Risk




As of
December 31, 2009, the Partnership had no outstanding debt.




ITEM
8.                      Financial Statements and
Supplementary Data




The
Partnership's financial statements are included elsewhere
herein.  Reference is made to the Index to Financial Statements and
Financial Statement Schedules in Item 15(a).




ITEM
9.                      Changes in and Disagreements
with Accountants on Accounting and Financial Disclosure





Not applicable.




ITEM
9A.                   Controls and
Procedures




Conclusion
Regarding the Effectiveness of Disclosure Controls and Procedures




Public
Storage maintains disclosure controls and procedures that are designed to ensure
that information required to be disclosed in reports the Partnership files and
submits under the Securities Exchange Act of 1934, as amended, (“Exchange Act”)
is recorded, processed, summarized and reported within the time periods
specified in accordance with SEC guidelines and that such information is
communicated to the Partnership’s management, including Public Storage’s Chief
Executive Officer and Chief Financial Officer, to allow timely decisions
regarding required disclosure based on the definition of "disclosure controls
and procedures" in Rules 13a-15(e) and 15d-15(e) of the Exchange
Act.  In designing and evaluating the disclosure controls and
procedures, management recognized that any controls and procedures, no matter
how well designed and operated, can provide only reasonable assurance of
achieving the desired control objectives and management necessarily was required
to apply its judgment in evaluating the cost-benefit relationship of possible
controls and procedures in reaching that level of reasonable
assurance.




As of
December 31, 2009, Public Storage carried out an evaluation, under the
supervision and with the participation of the Partnership’s management,
including Public Storage’s Chief Executive Officer and Chief Financial Officer,
of the effectiveness of the design and operation of the Partnership’s disclosure
controls and procedures (as such term is defined in Rules 13a-15(e) and
15d-15(e) of the Exchange Act.  Based on that evaluation, Public
Storage’s Chief Executive Officer and Chief Financial Officer concluded that the
Partnership’s disclosure controls and procedures were effective as of
December 31, 2009, at a reasonable assurance level.




16




Management’s
Report on Internal Control over Financial Reporting




Our
management is responsible for establishing and maintaining adequate internal
control over financial reporting, as such term is defined in Rules 13a-15(f) and
15d-15(f) of the Exchange Act.  Under the supervision and with the
participation of our management, including Public Storage’s Chief Executive
Officer and Chief Financial Officer, we conducted an evaluation of the
effectiveness of our internal control over financial reporting based on the
framework in Internal
Control-Integrated Framework issued by the Committee on Sponsoring
Organizations of the Treadway Commission.  Based on our evaluation
under the framework in Internal Control-Integrated
Framework, our management concluded that our internal control over
financial reporting was effective as of December 31, 2009.




This
annual report does not include an audit report of the Partnership’s independent
registered public accounting firm regarding internal control over financial
reporting.  Management’s report was not subject to audit by the
Partnership’s independent registered public accounting firm pursuant to
temporary rules of the SEC that permit the Partnership to provide only
management’s report in this annual report.




Changes
in Internal Control over Financial Reporting




There
have not been any changes in our internal control over financial reporting (as
such term is defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act)
during the fourth quarter of 2009 to which this report relates that have
materially affected, or are reasonable likely to materially affect, our internal
control over financial reporting.




ITEM
9B.                      Other
Information




Not
applicable.




17


PART
III




ITEM
10.                      Directors, Executive
Officers and Corporate Governance




The
Partnership has no directors or executive officers.




The
Partnership's General Partners are PS and B. Wayne Hughes.  PS, acting
through its trustees and executive officers, and Mr. Hughes manage and make
investment decisions for the Partnership.  The self-storage facilities
are managed by PS pursuant to a Management Agreement.




Pursuant
to the Partnership's Amended Certificate and Agreement of Limited Partnership
(the "Partnership Agreement"), a copy of which is included in the Partnership's
prospectus included in the Partnership's Registration Statement, each of the
General Partners continues to serve until (i) death, insanity, insolvency,
bankruptcy or dissolution, (ii) withdrawal with the consent of the other general
partner and a majority vote of the limited partners, or (iii) removal by a
majority vote of the limited partners.




The names
of all trustees and executive officers of PS, the offices held by each of them
with PS, and their ages and business experience during the past five years are
as follows:




Name
            
            Positions
      with PSB.
      Wayne Hughes
            
            Chairman
      of the BoardRonald
      L. Havner, Jr.
            
            Vice
      Chairman of the Board, Chief Executive Officer, President and
      TrusteeJohn
      Reyes
            
            Senior
      Vice President and Chief Financial OfficerMark
      C. Good
            
            Senior
      Vice President and Chief Operating OfficerDavid
      F. Doll
            
            Senior
      Vice President and President, Real Estate GroupCandace
      N. Krol
            
            Senior
      Vice President of Human ResourcesSteven
      M. Glick
            
            Senior
      Vice President and Chief Legal OfficerDann
      V. Angeloff
            
            TrusteeWilliam
      C. Baker
            
            TrusteeJohn
      T. Evans
            
            TrusteeTamara
      Hughes Gustavson
            
            TrusteeUri
      P. Harkham
            
            TrusteeB.
      Wayne Hughes, Jr.
            
            TrusteeHarvey
      Lenkin
            
            TrusteeAvedick
      B. Poladian
            
            TrusteeGary
      E. Pruitt
            
            TrusteeRonald
      P. Spogli
            
            TrusteeDaniel
      C. Staton
            
            Trustee




The
following is a biographical summary of the current executive officers of
PS:




Ronald L.
Havner, Jr., age 52, has been the Vice-Chairman, Chief Executive Officer and a
member of the Board of Public Storage since November 2002 and President since
July 1, 2005.  Mr. Havner joined Public Storage in 1986 and
held a variety of senior management positions until his appointment as
Vice-Chairman and Chief Executive Officer in 2002. Mr. Havner has been
Chairman of Public Storage’s affiliate, PS Business Parks, Inc. (PSB), since
March 1998 and was Chief Executive Officer of PSB from March 1998 until August
2003.  He is also a member of the Board of Governors and the Executive
Committee of the National Association of Real Estate Investment Trusts, Inc.
(NAREIT).  He is also a director of Business Machine Security, Inc.,
General Finance Corporation and a member of the NYU REIT Center Board of
Advisors.




John
Reyes, age 49, Senior Vice President and Chief Financial Officer, joined Public
Storage in 1990 and was Controller of Public Storage from 1992 until December
1996 when he became Chief Financial Officer.  He became a Vice
President of Public Storage in November 1995 and a Senior Vice President of
Public Storage in December 1996.  From 1983 to 1990, Mr. Reyes was
employed by Ernst & Young as a certified public accountant.




18
    The following is a biographical summary of
the current outside Trustees of PS:
     19


Tamara
Hughes Gustavson, age 48, became a member of the PS Board in November
2008.  She was employed by PS from 1978 to 2003, serving most recently as
Vice President, Administration.  She also serves on the Board of
Directors of the USC-CHLA Institute for Pediatric Clinical
research.  Ms Gustavson is the daughter of B. Wayne Hughes, Chairman
of the Board, and the sister of B. Wayne. Hughes, Jr., also a
Trustee.




Uri P.
Harkham, age 61, a member of the Compensation Committee, became a trustee of the
PS Board in March 1993.  Mr. Harkham has been the President and
Chief Executive Officer of Harkham Industries, which specializes in designing,
manufacturing and marketing women’s clothing under its four labels, Harkham,
Hype, Jonathan Martin and Johnny Martin, since its organization in 1974. 
Since 1978, Mr. Harkham has been the Chief Executive Officer of Harkham
Family Enterprises, a real estate firm specializing in buying and rebuilding
retail and mixed use real estate throughout Southern California.




B. Wayne
Hughes, Jr., age 50, became a trustee of the PS Board in January 1998.  He
was employed by PS from 1989 to 2002, serving as Vice President - Acquisitions
of the Company from 1992 to 2002.  Mr. Hughes, Jr. is currently
Vice President of American Commercial Equities, LLC and its affiliates,
companies engaged in the acquisition and operation of commercial properties in
California.  He is the son of B. Wayne Hughes, Chairman of the Board,
and the brother of Tamara Hughes Gustavson, also a Trustee.




Harvey
Lenkin, age 73, a member of the Audit Committee, became a trustee of the PS
Board in 1991.  Mr. Lenkin retired as President and Chief Operating Officer
of PS in 2005, and was a consultant for PS until July 1, 2006. 
Mr. Lenkin was employed by PS or its predecessor for 27 years.  
He has been a director of PS’ affiliate, PS Business Parks, Inc., since March
1998 and was President of PS Business Parks, Inc. from 1990 until March
1998.  He is also a director of Paladin Realty Income Properties I,
Inc. and a director of Huntington Hospital, Pasadena, California and serves on
the Board of the Ronald McDonald House Charity of Southern
California.




Avedick
B. Poladian, age 58, has been Executive Vice President and Chief Operating
Officer for Lowe Enterprises, Inc., a diversified national real estate company
active in commercial, residential and hospitality property investment,
management and development since 2007. He was Executive Vice President, Chief
Financial Officer and Chief Administrative Officer for Lowe from 2003 to 2006.
Mr. Poladian was with Arthur Andersen from 1974 to 2002 and is a certified
public accountant (inactive). He is also a director and member of the Audit
Committee of Occidental Petroleum Corporation and Western Asset Funds (Western
Asset Income Fund, Western Asset Premier Bond Fund and Western Asset Funds,
Inc.) and was a director of California Pizza Kitchen from 2004 to
2008.  He is also a director of the YMCA of Metropolitan Los Angeles
and a former Trustee of Loyola Marymount University.




Gary E.
Pruitt, age 59, Chairman of the Audit Committee and a member of the Compensation
Committee, became a trustee of the PS Board in August 2006 in connection with
the merger of Shurgard Storage Centers, Inc. with PS.  Mr. Pruitt was
previously a director of Shurgard.  He is the Chairman and Chief Executive
Officer of Univar N.V., a chemical distribution company based in Bellevue,
Washington with distribution centers in the United States, Canada and
Europe.  Mr. Pruitt joined Univar in 1978 and held a variety of senior
management positions until his appointment as Chairman and Chief Executive
Officer in 2002.




Ronald P.
Spogli, age 62, co-founded Freeman Spogli & Co., a private investment firm,
in 1983 after a career in investment banking with Dean Witter Reynolds where he
was a Managing Director responsible for mergers and acquisitions in the western
United States.  He rejoined the Freeman Spogli & Co. in June 2009
after having served as the United States Ambassador to the Italian Republic and
the Republic of San Marino from August 2005 until February
2009.  Mr. Spogli graduated Phi Beta Kappa with great distinction
in history from Stanford University.  He earned his Master’s degree in
business administration from Harvard University.




Daniel C.
Staton, age 57, Chairman of the Compensation Committee and a member of the Audit
Committee, became a member of the PS Board in March 1999 in connection with the
merger of Storage Trust Realty with the Company.  Mr. Staton was Chairman
of the Board of Trustees of Storage Trust Realty from February 1998 until March
1999 and a Trustee of Storage Trust Realty from November 1994 until March
1999.  He is Chairman of Staton Capital, an investment and venture capital
company and the Co-Chief Executive Officer of FriendFinder Networks, Inc.
(formerly PMGI), a print and electronic media company and Chief Executive
Officer of Enterprise Acquisition Corp. Mr. Staton was the Chief Operating
Officer and Executive Vice President of Duke Realty Investments, Inc. from 1993
to 1997 and a director of Duke Realty Investments, Inc. from 1993 until August
1999.


20




Each
Trustee of PS serves until he or she resigns or is removed from office by PS,
and may resign or be removed from office at any time with or without
cause.  Each officer of PS serves until he or she resigns or is
removed by the Board of Trustees of PS.  Any such officer may resign
or be removed from office at any time with or without cause.




There
have been no events under any bankruptcy act, no criminal proceedings, and no
judgments or injunctions material to the evaluation of the ability of any
trustee or executive officer of PS during the past five years.




The
members of the PS Audit Committee of the Board are:  Gary E. Pruitt
(Chairman), Dann V. Angeloff, William C. Baker, Harvey Lenkin and
Daniel C. Staton.  The Board of PS has determined that Audit
Committee members, Gary E. Pruitt and Daniel C. Staton, each qualify as an audit
committee financial expert within the meaning of the rules of the Securities and
Exchange Commission.  The Board has further determined that Messrs.
Pruitt, Angeloff, Baker, Lenkin and Staton are each independent within the
meaning of Item 7(d)(3)(iv) of Schedule 14A under the Exchange Act.




The
financial records of the Partnership are maintained and prepared by employees of
PS.  The Board of Trustees of PS has adopted a code of ethics for its
senior financial officers.  The Code of Ethics applies to those
persons serving as PS’ principal executive officer, principal financial officer
and principal accounting officer.  A copy of the Code of Ethics may be
found on the PS website at www.publicstorage.com/Corporateinformation/CorpGovernance.apsx
and available in print by written request from the Secretary of PS at 701
Western Ave., Glendale, CA 91201-2349.




ITEM
11.                      Executive
Compensation




The
Partnership has no subsidiaries, directors or officers.  See Item 13
for a description of certain transactions between the Partnership and its
General Partners and their affiliates.




ITEM
      12.
            Security Ownership of
      Certain Beneficial Owners and Management and Related Stockholder
      Matters




(a)
            At
      March 25, 2010, the following beneficially owned more than 5% of the
      Units:




Title
                of
      Class
            
            Name
      and Address
                of
      Beneficial Owner
            
            Beneficial
                Ownership
            
            Percent
                of
      ClassUnits
      of Limited Partnership Interest
            
            Public
      Storage
              701
      Western Ave.
              Glendale,
      California 91201
            
            6,274
      Units (1)
            
            
            31.4
            %Units
      of Limited Partnership Interest
            
            H-G
      Family Corporation, PS Orangeco Partnerships, Inc.
              701
      Western Ave.
              Glendale,
      California 91201
            
            6,196
      Units (2)
            
            
            31.0
            %




1)
            Includes
      (i) 6,169 Units owned by PS as to which PS has sole voting and dispositive
      power, (ii) 80 Units which, on January 1, 2009, PS exercised its option to
      acquire from Tamara Hughes Gustavson, an adult daughter of Hughes and
      (iii) 25 Units which on January 1, 2009, PS exercised its option to
      acquire from H-G Family Corporation, a corporation of which Hughes’
      children are shareholders.




2)
            Includes
      (i) 6,000 Units owned by BWH Marina Corporation II, a corporation
      wholly-owned by Hughes, as to which Hughes has sole voting and dispositive
      power and (ii) 196 Units owned by PS Orangeco Partnerships, Inc., a
      corporation in which Hughes and members of his family own approximately
      48% of the voting stock, PS owns 46% and members of PS’s management and
      related individuals own approximately
6%.




(b)     
        The Partnership has no officers
and directors.




The General Partners (or their
predecessor-in-interest) have contributed $101,010 to the capital of the
Partnership and as a result participate in the distributions to the limited
partners and in the Partnership's profits and losses in the same proportion that
the General Partners' capital contribution bears to the total capital
contribution (approximately $80,808 was contributed by PS and $20,202 was
contributed by Mr. Hughes).  In 1995, Mr. Hughes contributed his
ownership and rights to distributions from the Partnership to BWH Marina
Corporation II, a corporation wholly-owned by Mr. Hughes.  In 2002,
BWH Marina Corporation II sold its interest to H-G Family
Corporation.  As such, Mr. Hughes continues to act as a general
partner but receives no direct compensation or other consideration from the
Partnership.  Information regarding ownership of Units by PS and
Hughes, the General Partners, is set forth under section (a)
above.  The trustees and executive officers of PS (including Hughes),
as a group (16 persons), beneficially own an aggregate of 6,214 Units,
representing 31.1% of the Units (including the 6,000 Units owned by H-G Family
Corporation and the 196 Units owned by PS Orangeco Partnerships,
Inc.).




21




(c)  The
Partnership knows of no contractual arrangements, the operation of the terms of
which may at a subsequent date result in a change in control of the Partnership,
except for articles 16, 17 and 21.1 of the Partnership's Amended Certificate and
Agreement of Limited Partnership (the "Partnership Agreement"), a copy of which
is included in the Partnership's prospectus included in the Partnership's
Registration Statement File No. 2-57750.  Those articles provide, in
substance, that the limited partners shall have the right, by majority vote, to
remove a general partner and that a general partner may designate a successor
with the consent of the other general partner and a majority of the limited
partners.





ITEM
13.                      Certain Relationships,
Related Transactions and Trustee Independence




The
Partnership Agreement provides that the General Partners will be entitled to
cash incentive distributions in an amount equal to (i) 8% of distributions of
cash flow from operations until the distributions to all partners from all
sources equal their capital contributions; thereafter, 25% of distributions of
cash flow from operations, and (ii) 25% of distributions from net proceeds from
sale and financing of the Partnership's properties remaining after distribution
to all partners of any portion thereof required to cause distributions to
partners from all sources to equal their capital
contributions.  During 1985, the partners received cumulative
distributions equal to their capital contributions.  Mr. Hughes has
assigned his ownership and distribution rights in the Partnership to BWH Marina
Corporation II (“BWH Marinas”), and BWH Marinas sold its interests to H-G Family
Corporation in 2002.  In addition to their distribution rights with
respect to their general partner’s interests, PS and H-G Family Corporation own
6,169 and 6,025 Limited Partner Units, respectively.  During 2009, PS
and H-G Family Corporation received approximately $1,060,000 and $265,000,
respectively, in distributions related to their general partner’s ownership
interests.  As described above, the General Partners also hold Limited
Partnership Units.  Through these holdings, PS and the Hughes Family
received $1,267,000 and $1,154,000, respectively, of cash distributions during
2009.




The
Partnership has a management agreement (the “Management Agreement”) with PS (as
successor-in-interest to PSMI).  Under the Management Agreement, the
Partnership pays PS a fee of 6% of the gross revenues of the mini-warehouse
properties operated for the Partnership.  For as long as the
Management Agreement is in effect, PS has granted the Partnership a
non-exclusive license to use two PS service marks and related designs, including
the “Public Storage” name, in conjunction with rental and operation of
facilities managed pursuant to the Management Agreement.  Upon
termination of the Management Agreement, the Partnership would no longer have
the right to use the service marks and related designs.  The General
Partners believe that the loss of the right to use the service marks and related
designs could have a material adverse effect on the Partnership’s
business.  The Management Agreement with PS provides that the
Management Agreement may be terminated without cause upon 60 days written notice
by the Partnership or six months notice by PS.  During 2009, 2008 and
2007, the Partnership paid fees of $438,000, $457,000 and $440,000,
respectively, to PS pursuant to the Management Agreement.




In
addition, the Partnership combines its insurance purchasing power with PS
through captive insurance entities controlled by PS (see Note 5 to the
Partnership’s December 31, 2009 financial statements).  These captive
entities provide limited property and liability insurance to the Partnership at
commercially competitive rates.  The Partnership and PS also utilize
unaffiliated insurance carriers to provide property and liability insurance in
excess of the captive entities’ limitations.  Premiums paid to the
captive entities for the years ended December 31, 2009, 2008 and 2007 were
$45,000, $55,000 and $49,000, respectively.




The
Partnership’s facilities, along with facilities owned by PS and its affiliates,
are managed and marketed jointly by PS in order to take advantage of scale and
other efficiencies.  Joint costs are allocated on a methodology meant
to fairly allocate such costs based upon the related activities.  As a
result, significant components of cost of operations, such as payroll costs,
advertising and promotion, data processing and insurance expenses are shared and
allocated among the properties using methodologies meant to fairly allocate such
costs based upon the related activities.  The total of such expenses,
substantially all of which are included in cost of operations on the
Partnership’s statements of income, amounted to $708,000, $737,000 and $765,000
for the years ended December 31, 2009, 2008, and 2007,
respectively.




As of
December 31, 2009, the Partnership had $559,000 in amounts due from
affiliates.  These amounts arose in December 2009 from the timing of
the settlement of shared costs and were collected in January 2010.




22




The
Trustees of PS are identified in Item 10 on page 18 of this report.




ITEM
14.                      Principal Accountant Fees
and Services




Fees billed to the Partnership by Ernst
& Young LLP for 2009 and 2008, as are follows:




Audit Fees:  Audit fees
billed (or expected to be billed) to the Partnership by Ernst & Young LLP
for the audit of the Partnership’s annual financial statements and reviews of
the quarterly financial statements included in the Partnership’s quarterly
reports on Form 10-Q totaled $19,000 for each of the years ended December 31,
2009 and 2008.




Tax Fees:  Tax fees billed to
the Partnership by Ernst & Young LLP for tax services (primarily federal and
state income tax preparation) totaled $13,000 for each of the years ended
December 31, 2009 and 2008.





Audit-Related Fees and Other
Fees:  During 2009 and 2008 Ernst & Young LLP did not bill the
Partnership for audit-related services or any other services, except audit
services and tax services denoted above.




The Audit Committee of PS pre-approves
all services performed by Ernst & Young LLP, including those listed
above.  At this time, the Audit Committee has not delegated
pre-approval authority to any member or members of the Audit
Committee.




23


PART
IV




ITEM
15.                      Exhibits and Financial
Statement Schedules




(a)
            List
      of documents filed as part of this
Report.




1.
            Financial
      Statements.  See Index to Financial Statements and Financial
      Statement Schedule.




2.
            Financial
      Statement Schedules.  See Index to Financial Statements and
      Financial Statement Schedule.




3.
            Exhibits:
      See Exhibit Index contained
below.






(b)
            Exhibits:  See
      Exhibit Index contained below.




(c)
            Not
      applicable.




24


PUBLIC
STORAGE PROPERTIES, LTD.




EXHIBIT
INDEX




(Items
15(a)(3) and 15(b))




3.1
            Amended
      Certificate and Agreement of Limited Partnership.  Previously
      filed with the Securities and Exchange Commission as Exhibit A to the
      Partnership’s Prospectus included in Registration Statement No. 2-57750
      and incorporated herein by reference.10.1
            Second
      Amended and Restated Management Agreement dated November 16, 1995 between
      the Partnership and Public Storage, Inc.  Previously filed with
      the Securities and Exchange Commission as an exhibit to the Partnership’s
      Annual Report on Form 10-K for the year ended December 31, 1996 and
      incorporated herein by reference.10.2
            Loan
      documents dated January 27, 1998 between the Partnership and Public
      Storage.  Previously filed with the Securities and Exchange
      Commission as an exhibit to the Partnership’s Annual Report on Form 10-K
      for the year ended December 31, 1997 and incorporated herein by
      reference.14
            Code
      of Ethics for Senior Financial Officers of Public
      Storage.  Filed with the Partnership’s Annual Report on Form
      10-K for the year ended December 31, 2003 and incorporated herein by
      reference.31.1
            Rule
      13a – 14(a) Certification.  Filed herewith.31.2
            Rule
      13a – 14(a) Certification.  Filed herewith.32
            Section
      1350 Certifications.  Filed
herewith.


25


SIGNATURES




Pursuant
to the requirements of Section 13 or 15(d) of the Securities Exchange Act of
1934, the Partnership has duly caused this report to be signed on its behalf by
the undersigned, thereunto duly authorized.




PUBLIC
      STORAGE PROPERTIES, LTD.a
      California Limited PartnershipDated:  March
      25, 2010
            By:
            Public
      Storage, General PartnerBy:
            /s/
      Ronald L. Havner, Jr.Ronald
      L. Havner, Jr., Vice Chairman of the Board, Chief Executive Officer and
      President of Public Storage, Corporate General PartnerBy:
            /s/
      B. Wayne HughesB.
      Wayne Hughes, General Partner and Chairman of the Board of Public
      Storage









26




Pursuant
to the requirements of the Securities Exchange Act of 1934, this report has been
signed below by the following persons on behalf of the Partnership in the
capacities and on the dates indicated.








Signature
            
            Capacity
            
            Date/s/ Ronald L. Havner
      Jr.
            
            Vice
      Chairman of the Board, Chief Executive Officer and President of Public
      Storage, Corporate General Partner
            
            March
      25, 2010Ronald
      L. Havner, Jr./s/ B. Wayne
      Hughes
            
            General
      Partner and Chairman of the Board of Public Storage
            
            March
      25, 2010B.
      Wayne Hughes/s/ John
      Reyes
            
            Senior
      Vice President and Chief Financial Officer of Public Storage (principal
      financial officerand
      principal accounting officer)
            
            March
      25, 2010John
      Reyes/s/ Dann V.
      Angeloff
            
            Trustee
      of Public Storage
            
            March
      25, 2010Dann
      V. Angeloff/s/ William
      Baker
            
            Trustee
      of Public Storage
            
            March
      25, 2010William
      C. Baker/s/ John T.
      Evans
            
            Trustee
      of Public Storage
            
            March
      25, 2010John
      T. Evans/s/ Tamara Hughes
      Gustavson
            
            Trustee
      of Public Storage
            
            March
      25, 2010Tamara
      Hughes Gustavson/s/ Uri P.
      Harkham
            
            Trustee
      of Public Storage
            
            March
      25, 2010Uri
      P. Harkham/s/ B. Wayne Hughes,
      Jr.
            
            Trustee
      of Public Storage
            
            March
      25, 2010B.
      Wayne Hughes, Jr./s/ Harvey
      Lenkin
            
            Trustee
      of Public Storage
            
            March
      25, 2010Harvey
      Lenkin/s/ Gary E.
      Pruitt
            
            Trustee
      of Public Storage
            
            March
      25, 2010Gary
      E. Pruitt/s/ Daniel C.
      Staton
            
            Trustee
      of Public Storage
            
            March
      25, 2010Daniel
      C. Staton






















27




PUBLIC
STORAGE PROPERTIES, LTD.


INDEX
TO FINANCIAL STATEMENTS


AND


FINANCIAL
STATEMENT SCHEDULE


(Item
15 (a))








Page
              ReferenceReport
      of Independent Registered Public Accounting Firm
            
            
            F-1Balance
      sheets as of December 31, 2009 and 2008
            
            
            F-2For
      each of the three years ended December 31, 2009, 2008 and
      2007:Statements
      of income
            
            
            F-3Statements
      of partners' equity
            
            
            F-4Statements
      of cash flows
            
            
            F-5Notes
      to financial statements
            
            
            F-6
      - F-11Schedule:III
      - Real estate and accumulated depreciation
            
            
            F-12
      - F-13




All other
schedules have been omitted since the required information is not present or not
present in amounts sufficient to require submission of the schedule, or because
the information required is included in the financial statements or notes
thereto.


29







REPORT OF INDEPENDENT
REGISTERED PUBLIC ACCOUNTING FIRM




The
Partners


Public
Storage Properties, Ltd.




We have
audited the accompanying balance sheets of Public Storage Properties, Ltd. (the
“Partnership”) as of December 31, 2009 and 2008, and the related statements of
income, partners' equity and cash flows for each of the three years in the
period ended December 31, 2009.  Our audits also included the
financial statement schedule listed in the Index at Item 15(a).  These
financial statements and financial statement schedule are the responsibility of
the Partnership's management.  Our responsibility is to express an
opinion on these financial statements and financial statement schedule based on
our audits.




We
conducted our audits in accordance with the standards of the Public Company
Accounting Oversight Board (United States).  Those standards require
that we plan and perform the audit to obtain reasonable assurance about whether
the financial statements are free of material misstatement.  We were
not engaged to perform an audit of the Partnership’s internal control over
financial reporting.  Our audits included consideration of internal
control over financial reporting as a basis for designing audit procedures that
are appropriate in the circumstances, but not for the purpose of expressing an
opinion on the effectiveness of the Partnership’s internal control over
financial reporting.  Accordingly we express no such
opinion.  An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements, assessing
the accounting principles used and significant estimates made by management, as
well as evaluating the overall financial statement presentation.  We
believe that our audits provide a reasonable basis for our opinion.




In our
opinion, the financial statements referred to above present fairly, in all
material respects, the financial position of Public Storage Properties, Ltd. at
December 31, 2009 and 2008, and the results of its operations and its cash flows
for each of the three years in the period ended December 31, 2009, in conformity
with U.S. generally accepted accounting principles.  Also, in our
opinion, the related financial statement schedule, when considered in relation
to the basic financial statements taken as a whole, presents fairly in all
material respects the information set forth therein.






/s/ ERNST
& YOUNG LLP




March 25,
2010


Los
Angeles, California


F-1


PUBLIC
STORAGE PROPERTIES, LTD.


BALANCE
SHEETS


December
31, 2009 and 2008




December
      31,
                2009
            
            
            December
      31,
                2008ASSETSCash
      and cash equivalents
            
            $
            422,000
            
            
            $
            802,000Rent
      and other receivables
            
            
            68,000
            
            
            
            60,000Due
      from affiliates
            
            
            559,000
            
            
            
            -Real
      estate facilities, at cost:Buildings,
      land improvements and equipment
            
            
            10,296,000
            
            
            
            10,125,000Land
            
            
            2,476,000
            
            
            
            2,476,00012,772,000
            
            
            
            12,601,000Less
      accumulated depreciation
            
            
            (9,588,000
            )
            
            
            (9,441,000
            )3,184,000
            
            
            
            3,160,000Other
      assets
            
            
            47,000
            
            
            
            67,000Total
      assets
            
            $
            4,280,000
            
            
            $
            4,089,000LIABILITIES AND PARTNERS’
      EQUITYAccounts
      payable and accrued liabilities
            
            $
            111,000
            
            
            $
            136,000Deferred
      revenue
            
            
            165,000
            
            
            
            190,000Total
      liabilities
            
            
            276,000
            
            
            
            326,000Commitments
      and contingencies (Note 8)Partners’
      equity:Limited
      partners’ equity, $500 per unit, 20,000 units
              authorized, issued and outstanding
            
            
            2,973,000
            
            
            
            2,794,000General
      partners’ equity
            
            
            1,031,000
            
            
            
            969,000Total
      partners’ equity
            
            
            4,004,000
            
            
            
            3,763,000Total
      liabilities and partners’ equity
            
            $
            4,280,000
            
            
            $
            4,089,000


See
accompanying notes.
 F-2


PUBLIC
STORAGE PROPERTIES, LTD.


STATEMENTS
OF INCOME


For
the years ended December 31, 2009, 2008 and 2007




2009
            
            
            2008
            
            
            2007REVENUES:Rental
      income
            
            $
            7,302,000
            
            
            $
            7,621,000
            
            
            $
            7,341,000Other
      income
            
            
            203,000
            
            
            
            251,000
            
            
            
            183,0007,505,000
            
            
            
            7,872,000
            
            
            
            7,524,000COSTS
      AND EXPENSES:Cost
      of operations
            
            
            1,449,000
            
            
            
            1,526,000
            
            
            
            1,554,000Management
      fees paid to affiliate
            
            
            438,000
            
            
            
            457,000
            
            
            
            440,000Depreciation
            
            
            147,000
            
            
            
            142,000
            
            
            
            130,000Administrative
            
            
            85,000
            
            
            
            98,000
            
            
            
            86,0002,119,000
            
            
            
            2,223,000
            
            
            
            2,210,000NET
      INCOME
            
            $
            5,386,000
            
            
            $
            5,649,000
            
            
            $
            5,314,000Limited
      partners’ share of net income
            
            $
            4,059,000
            
            
            $
            4,266,000
            
            
            $
            3,701,000General
      partners’ share of net income
            
            
            1,327,000
            
            
            
            1,383,000
            
            
            
            1,613,000$
            5,386,000
            
            
            $
            5,649,000
            
            
            $
            5,314,000Limited
      partners’ share of net income per unit (20,000 units
      outstanding)
            
            $
            202.95
            
            
            $
            213.30
            
            
            $
            185.05


See
accompanying notes.
 F-3


PUBLIC
STORAGE PROPERTIES, LTD.


STATEMENTS
OF PARTNERS’ EQUITY


For
the years ended December 31, 2009, 2008 and 2007




Limited
      Partners
            
            
            General
      Partners
            
            
            Total
      Partners’ EquityBalance
      at December 31, 2006
            
            $
            3,314,000
            
            
            $
            1,149,000
            
            
            $
            4,463,000Net
      income
            
            
            3,701,000
            
            
            
            1,613,000
            
            
            
            5,314,000Cash
      distributions
            
            
            (4,680,000
            )
            
            
            (1,623,000
            )
            
            
            (6,303,000
            )Equity
      transfer
            
            
            244,000
            
            
            
            (244,000
            )
            
            
            -Balance
      at December 31, 2007
            
            
            2,579,000
            
            
            
            895,000
            
            
            
            3,474,000Net
      income
            
            
            4,266,000
            
            
            
            1,383,000
            
            
            
            5,649,000Cash
      distributions
            
            
            (3,980,000
            )
            
            
            (1,380,000
            )
            
            
            (5,360,000
            )Equity
      transfer
            
            
            (71,000
            )
            
            
            71,000
            
            
            
            -Balance
      at December 31, 2008
            
            
            2,794,000
            
            
            
            969,000
            
            
            
            3,763,000Net
      income
            
            
            4,059,000
            
            
            
            1,327,000
            
            
            
            5,386,000Cash
      distributions
            
            
            (3,820,000
            )
            
            
            (1,325,000
            )
            
            
            (5,145,000
            )Equity
      transfer
            
            
            (60,000
            )
            
            
            60,000
            
            
            
            -Balance
      at December 31, 2009
            
            $
            2,973,000
            
            
            $
            1,031,000
            
            
            $
            4,004,000





See
accompanying notes.
 F-4


PUBLIC
STORAGE PROPERTIES, LTD.


STATEMENTS
OF CASH FLOWS


For
the years ended December 31, 2009, 2008 and 2007




2009
            
            
            2008
            
            
            2007Cash
      flows from operating activities:Net
      income
            
            $
            5,386,000
            
            
            $
            5,649,000
            
            
            $
            5,314,000Adjustments
      to reconcile net income to net cash provided by operating
      activities:Depreciation
            
            
            147,000
            
            
            
            142,000
            
            
            
            130,000(Increase)
      decrease in rent and other receivables
            
            
            (8,000
            )
            
            
            (7,000
            )
            
            
            20,000Increase
      in due from affiliates
            
            
            (559,000
            )
            
            
            -
            
            
            
            -Decrease
      in other assets
            
            
            20,000
            
            
            
            11,000
            
            
            
            14,000(Decrease)
      increase in accounts payable
            
            
            (25,000
            )
            
            
            48,000
            
            
            
            (10,000
            )(Decrease)
      increase in deferred revenue
            
            
            (25,000
            )
            
            
            7,000
            
            
            
            24,000Total
      adjustments
            
            
            (450,000
            )
            
            
            201,000
            
            
            
            178,000Net
      cash provided by operating activities
            
            
            4,936,000
            
            
            
            5,850,000
            
            
            
            5,492,000Cash
      flows from investing activities:Additions
      to real estate facilities
            
            
            (171,000
            )
            
            
            (247,000
            )
            
            
            (113,000
            )Net
      cash used in investing activities
            
            
            (171,000
            )
            
            
            (247,000
            )
            
            
            (113,000
            )Cash
      flows from financing activities:Distributions
      paid to partners
            
            
            (5,145,000
            )
            
            
            (5,360,000
            )
            
            
            (6,303,000
            )Net
      cash used in financing activities
            
            
            (5,145,000
            )
            
            
            (5,360,000
            )
            
            
            (6,303,000
            )Net
      (decrease)  increase in cash and cash
equivalents
            
            
            (380,000
            )
            
            
            243,000
            
            
            
            (924,000
            )Cash
      and cash equivalents at the beginning of the year
            
            
            802,000
            
            
            
            559,000
            
            
            
            1,483,000Cash
      and cash equivalents at the end of the year
            
            $
            422,000
            
            
            $
            802,000
            
            
            $
            559,000


See
accompanying notes.
 F-5
 
 PUBLIC
STORAGE PROPERTIES, LTD.
 NOTES
TO FINANCIAL STATEMENTS
 December
31, 2009


1.           Description
of Partnership




Public
Storage Properties, Ltd. (the "Partnership") is a publicly held limited
partnership formed under the California Uniform Limited Partnership Act in
November 1976.  The Partnership raised $10,000,000 in gross proceeds
by selling 20,000 units of limited partnership interest ("Units") in an
interstate offering, which commenced in October 1977 and completed in January
1978.  The general partners in the Partnership are Public Storage,
formerly Public Storage, Inc., (“PS”) and B. Wayne Hughes
(“Hughes”).




The
Partnership was formed to engage in the business of developing and operating
self-storage facilities for personal and business use.  The
Partnership owns nine self-storage facilities located in
California.




2.           Summary
of Significant Accounting Policies and Partnership Matters




Use of
Estimates:




The
preparation of financial statements in conformity with United States (“U.S.”)
generally accepted accounting principles (“GAAP”) requires management to make
estimates and assumptions that affect the amounts reported in the financial
statements and accompanying notes.  Actual results could differ from
those estimates.




Revenue and Expense
Recognition:




Rental
income, which is generally earned pursuant to month-to-month leases for storage
space, is recognized as earned.  Promotional discounts are recognized
as a reduction to rental income over the promotional period, which is generally
during the first month of occupancy.  Late charges and administrative
fees are recognized as income when collected.  Interest income is
recognized as earned.




We accrue
for property tax expense based upon actual amounts billed for the related time
periods and, in some circumstances due to taxing authority assessment and
billing timing and disputes of assessed amounts, estimates and historical
trends.  If these estimates are incorrect, the timing and amount of
expense recognition could be affected.  Cost of operations, general
and administrative expense, as well as television, yellow page, and other
advertising expenditures are expensed as incurred.  Casualty losses or
gains are recognized in the period the casualty occurs, based upon the
differential between the book value of assets destroyed, and estimated insurance
proceeds, if any, that we expect to receive in accordance with our insurance
contracts.




Allocation of Net
Income:




The
general partners' share of net income consists of amounts attributable to their
1% capital contribution and an additional percentage of cash flow (as defined)
which relates to the general partners' share of cash distributions as set forth
in the Partnership Agreement (Note 4).  All remaining net income is
allocated to the limited partners.




Per unit
data is based on the weighted average number of the limited partnership units
(20,000) outstanding during the period.




Financial
Instruments:




The
Partnership has estimated the fair value of our financial instruments using
available market information and appropriate valuation
methodologies.  Considerable judgment is required in interpreting
market data to develop estimates of market value.  Accordingly,
estimated fair values are not necessarily indicative of the amounts that could
be realized in current market exchanges.




F-6
 
 PUBLIC
STORAGE PROPERTIES, LTD.
 NOTES
TO FINANCIAL STATEMENTS
 December
31, 2009




For
purposes of financial statement presentation, we consider all highly liquid
financial instruments such as short-term treasury securities, money market funds
with daily liquidity and a rating of at least AAA by Standard and Poor’s, or
investment grade (rated A1 by Standard and Poor’s) short-term commercial paper
with remaining maturities of three months or less at the date of acquisition to
be cash equivalents.




Due to
the short maturity and the underlying characteristics of our cash and cash
equivalents, other assets, due from affiliates, and accrued and other
liabilities, we believe the carrying values as presented on the balance sheets
are reasonable estimates of fair value.




Financial
assets that are exposed to credit risk consist primarily of cash and cash
equivalents as well as rent and other receivables.  Cash and cash
equivalents, as described above, are only invested in instruments with an
investment grade rating.  Our receivables consist of small individual
amounts.  Accordingly, credit risk on these assets as a whole is
minimal.




Real Estate Facilities and
Evaluation of Asset Impairment:




Real
estate facilities are recorded at cost.  Costs associated with the
development, construction, renovation and improvement of properties are
capitalized.  Interest, property taxes, and other costs associated
with the development incurred during the construction period are capitalized as
building cost.  Expenditures for repairs and maintenance are expensed
when incurred.  Depreciation expense is computed using the
straight-line method over the estimated useful lives of the buildings and
improvements, which generally range from 5 to 25 years.  At December
31, 2009, all of the real estate facilities have been in service longer than 25
years, and accordingly the original development costs of such buildings are
fully depreciated.




We
evaluate our real estate for impairment on a quarterly basis.  We
first evaluate these assets for indicators of impairment, and if any indicators
of impairment are noted, we determine whether the carrying value of the real
estate is in excess of the future estimated undiscounted cash flows attributable
to the real estate.  If there is excess carrying value over such
future undiscounted cash flows, an impairment charge is booked for the excess of
carrying value over the real estate’s estimated fair value.  Any real
estate facility which we expect to sell or otherwise dispose of prior to its
estimated useful life is stated at the lower of its estimated net realizable
value (estimated fair value less cost to sell) or its carrying
value.  No impairment was identified from our evaluations in any
periods presented in the accompanying financial statements.




Deferred
Revenue:




Deferred
revenue totaling $165,000 at December 31, 2009 ($190,000 at December 31, 2008),
consists of prepaid rents, which are recognized as rental income when
earned.




Environmental
Cost:




The
Partnership’s policy is to accrue environmental assessments and/or remediation
costs when it is probable that such efforts will be required and the related
costs can be reasonably estimated.  Although there can be no
assurance, we are not aware of any environmental contamination at any of our
facilities, which, individually or in the aggregate, would be material to our
overall business, financial condition or results of operations.




F-7
 
 PUBLIC
STORAGE PROPERTIES, LTD.
 NOTES
TO FINANCIAL STATEMENTS
 December
31, 2009





Income
Taxes:




Public
Storage Properties, Ltd. is treated as a partnership for federal and state
income tax purposes with the taxable income of the entity allocated to each
partner in accordance with the Partnership Agreement.  Accordingly, no
federal income tax expense is recorded by the Partnership.




Recent Accounting
Pronouncements and Guidance:




As of
March 25, 2010, there have been no recent accounting pronouncements and
guidance, which were not effective for implementation prior to December 31,
2009, that would have a material impact upon reporting the operations or
financial position of the Partnership.




Segment
Reporting:




The
Partnership only has one reportable segment.




3.           Cash
Distributions




The
Partnership Agreement requires that cash available for distribution (cash flow
from all sources less cash necessary for any obligations or capital
improvements) be distributed at least quarterly.  During 2009, we paid
distributions to the limited and general partners totaling $3,820,000 ($191.00
per unit) and $1,325,000, respectively.  During 2008, we paid
distributions to the limited and general partners totaling $3,980,000 ($199.00
per unit) and $1,380,000, respectively.  During 2007, we paid
distributions to the limited and general partners totaling $4,680,000 ($234.00
per unit) and $1,623,000, respectively.  Future distribution rates may
be adjusted to levels which are supported by operating cash flow after
provisions for capital improvements and any other obligations.




4.           Partners'
Equity




PS and
Hughes are general partners of the Partnership.  In 1995, Hughes
contributed his ownership and rights to distributions from the Partnership to
BWH Marina Corporation II, a corporation wholly-owned by Hughes.  In
2002, BWH Marina Corporation II sold its interests to H-G Family
Corporation.  As such, Mr. Hughes continues to act as a general
partner but receives no direct compensation or other consideration from the
Partnership.




The
general partners have a 1% interest in the Partnership.  In addition,
the general partners have an 8% interest in cash distributions attributable to
operations (exclusive of distributions attributable to sale and financing
proceeds until the limited partners recover all of their initial
investment).  Thereafter, the general partners have a 25% interest in
all cash distributions (including sale and financing proceeds).  In
1985, the limited partners recovered all of their initial
investment.  All subsequent cash distributions are being made 25.75%
(including the 1% interest) to the general partners and 74.25% to the limited
partners.  Transfers of equity are made periodically to reconcile the
partners' equity accounts to the provisions of the Partnership
Agreement.  These transfers have no effect on the results of
operations or distributions to partners.




5.           Related
Party Transactions




Management Agreement and
Shared Expenses with PS




The
Partnership has a management agreement (the “Management Agreement”) with PS
pursuant to which PS operates the self-storage facilities for a fee equal to 6%
of the facilities' gross revenue (as defined).  For 2009, 2008 and
2007, the Partnership paid PS $438,000, $457,000 and $440,000, respectively,
pursuant to this Management Agreement.




F-8
 
 PUBLIC
STORAGE PROPERTIES, LTD
 NOTES
TO FINANCIAL STATEMENTS
 December
31, 2009




The
Management Agreement between the Partnership and PS provides that the Management
Agreement may be terminated without cause upon 60 days written notice by the
Partnership or six months notice by PS.




The
Partnership’s facilities, along with facilities owned by PS and its affiliates,
are managed and marketed jointly by PS in order to take advantage of scale and
other efficiencies.  Joint costs are allocated on a methodology meant
to fairly allocate such costs based upon the related activities.  As a
result, significant components of cost of operations, such as payroll costs,
advertising and promotion, data processing and insurance expenses are shared and
allocated among the properties using methodologies meant to fairly allocate such
costs based upon the related activities.  The total of such expenses,
substantially all of which are included in cost of operations in our
accompanying statements of income, amounted to $708,000, $737,000 and $765,000
for the years ended December 31, 2009, 2008, and 2007,
respectively.




Ownership of Limited
Partnership Interest by the General Partners




PS owns
6,274 Limited Partnership Units (“Units”), as to which PS has sole voting and
dispositive power.




At
December 31, 2008, Hughes and members of his family (the “Hughes Family”) owned
6,105 Units.  Hughes owned 6,025 Units, as to which Hughes had sole
voting and dispositive power, through a wholly-owned corporation and Tamara
Hughes Gustavson, an adult daughter of Hughes, owned 80 Units as to which Tamara
Hughes Gustavson had sole voting and dispositive power.  On January 1,
2009, PS exercised its option to acquire 25 of the Units held by Hughes and the
80 Units held by Tamara Hughes Gustavson for a cost of approximately
$20,000.  At December 31, 2009, Hughes owns 6,000 Units.




In
addition, there are 196 Units owned by PS Orangeco Partnerships, Inc., a
corporation in which the Hughes Family owns approximately 48% of the voting
stock, PS owns 46% and members of PS management and related individuals own
approximately 6%.




Captive Insurance Activities
with PS




The
Partnership has a 0.9% ownership interest in STOR-Re Mutual Insurance
Corporation (“STOR-Re”), which was formed in 1994 as an association captive
insurance company, and is controlled by PS.  The Partnership accounts
for its investment in STOR-Re, which is included in other asset on our
accompanying balance sheets, on the cost method, and has received no
distributions during the three years ended December 31, 2009.




STOR-Re
provides limited property and liability insurance coverage to the Partnership,
PS, and affiliates for losses occurring before April 1, 2004.  STOR-Re
was succeeded with respect to these activities for losses occurring after March
31, 2004 by a wholly owned subsidiary of PS (collectively, this entity and
STOR-Re are referred to as the “Captive Entities”).  Liabilities for
losses and loss adjustment expenses include an amount determined from loss
reports and individual cases and an amount, based on recommendations from an
outside actuary that is a member of the American Academy of Actuaries, using a
frequency and severity method, for losses incurred but not
reported.  Determining the liability for unpaid losses and loss
adjustment expense is based upon estimates and while we believe that the amount
is adequate, the ultimate loss may be in excess of or less than the amounts
provided.  The methods for making such estimates and for establishing
the resulting liability are reviewed quarterly.




F-9
 
 PUBLIC
STORAGE PROPERTIES, LTD.
 NOTES
TO FINANCIAL STATEMENTS
 December
31, 2009


The
following table sets forth certain condensed consolidated financial information
(unaudited) with respect to STOR-Re (representing 100% of this entity’s
operations and not the Partnership’s pro-rata share):




2009
            
            
            2008(Amount
      in thousands)For the year ended December
    31,Net
      investment income
            
            $
            332
            
            
            $
            675Loss
      and loss adjustment benefit (expense)
            
            
            444
            
            
            
            (500
            )Other
      expenses
            
            
            (210
            )
            
            
            (258
            )Net income (loss)
            
            $
            566
            
            
            $
            (83
            )At December 31,Total
      assets (primarily cash and other investments)
            
            $
            20,366
            
            
            $
            20,162Liabilities
      for losses and loss adjustment expenses
            
            
            4,065
            
            
            
            4,946Other
      liabilities
            
            
            1,095
            
            
            
            725Member’s
      surplus
            
            
            15,206
            
            
            
            14,491


Premiums
paid to the wholly-owned subsidiary of PS for the years ended December 31, 2009,
2008 and 2007 were $45,000, $55,000 and $49,000, respectively.




Other Activities with
PS




PS
Insurance Company - Hawaii, Ltd. (“PSICH”), is a corporation owned by PS that
reinsures policies against losses to goods stored by tenants in the
Partnership’s and PS’ storage facilities.  PSICH receives the premiums
and bears the risks associated with the re-insurance.  The Partnership
receives a fee (an “Access Fee”) from PSICH in return for providing tenant
listings.  This Access Fee is based on the number of spaces the
Partnership has to rent.  Included in other income on our accompanying
statements of income for these Access Fees are $196,000, $215,000 and $104,000
for the years ended December 31, 2009, 2008 and 2007, respectively.




A
subsidiary of PS sells locks and boxes to the general public and tenants to be
used in securing their spaces and moving their goods.  The subsidiary
of PS receives the revenues and bears the cost of the activities.




Due from
Affiliates




As of
December 31, 2009, the Partnership had $559,000 in amounts due from
affiliates.  These amounts arose in December 2009 from the timing of
the settlement of shared costs and were collected in January 2010.




6.           Taxes
Based on Income




Taxes
based on income are the responsibility of the individual partners and,
accordingly, the Partnership's financial statements do not reflect a provision
for such taxes.




Taxable
net income (unaudited) was $5,023,000, $5,516,000 and $5,339,000 for the years
ended December 31, 2009, 2008 and 2007, respectively.  The difference
between taxable net income and net income is primarily related to depreciation
expense resulting from differences in depreciation and capitalization
methodologies.




F-10
 
 PUBLIC
STORAGE PROPERTIES, LTD.
 NOTES
TO FINANCIAL STATEMENTS
 December
31, 2009








7.
            Supplementary
      Quarterly Financial Data
(unaudited)




Three
      Months EndedMarch
      31, 2009
            
            
            June
      30, 2009
            
            
            September
      30, 2009
            
            
            December
      31, 2009Rental
      Income
            
            $
            1,858,000
            
            
            $
            1,840,000
            
            
            $
            1,820,000
            
            
            $
            1,784,000Cost
      of Operations (including management fees and
      depreciation)
            
            $
            540,000
            
            
            $
            515,000
            
            
            $
            503,000
            
            
            $
            476,000Net
      Income
            
            $
            1,340,000
            
            
            $
            1,331,000
            
            
            $
            1,376,000
            
            
            $
            1,339,000Net
      Income Per Limited Partner Unit
            
            $
            49.00
            
            
            $
            50.55
            
            
            $
            51.75
            
            
            $
            51.65Cash
      Distributions
            
            $
            1,401,000
            
            
            $
            1,239,000
            
            
            $
            1,320,000
            
            
            $
            1,185,000Three
      Months EndedMarch
      31, 2008
            
            
            June
      30, 2008
            
            
            September
      30, 2008
            
            
            December
      31, 2008Rental
      Income
            
            $
            1,872,000
            
            
            $
            1,905,000
            
            
            $
            1,928,000
            
            
            $
            1,916,000Cost
      of Operations (including management fees and depreciation)
            
            $
            527,000
            
            
            $
            567,000
            
            
            $
            523,000
            
            
            $
            508,000Net
      Income
            
            $
            1,376,000
            
            
            $
            1,340,000
            
            
            $
            1,499,000
            
            
            $
            1,434,000Net
      Income Per Limited Partner Unit
            
            $
            53.45
            
            
            $
            51.00
            
            
            $
            57.50
            
            
            $
            51.35Cash
      Distributions
            
            $
            1,185,000
            
            
            $
            1,239,000
            
            
            $
            1,347,000
            
            
            $
            1,589,000




8.           Commitments
and Contingencies




Brinkley v. Public Storage,
Inc. (filed April 2005) (Superior Court of California – Los Angeles
County)




The
plaintiff sued PS on behalf of a purported class of California non-exempt
employees based on various California wage and hour laws.  Plaintiff
sought certification for alleged meal period violations, rest period violations,
failure to pay for travel time, failure to pay for mileage reimbursement, and
for wage statement violations.  The Court certified subclasses based
only on alleged meal period and wage statement violations.  In June
2007, the Court granted PS’ summary judgment motion as to the causes of action
relating to the subclasses certified and dismissed those
claims.  Plaintiff appealed.  The Court of Appeals sustained
the dismissal.  The California Supreme Court granted review but
deferred the matter pending disposition of a related issue in another
case.




Other
Items




PS and
the Partnership are a party to various claims, complaints, and other legal
actions that have arisen in the normal course of business from time to time,
that are not described above.  We believe that it is unlikely that the
outcome of these other pending legal proceedings including employment and tenant
claims, in the aggregate, will have a material adverse effect upon the
Partnership’s operations or financial position.







F-11


Public
Storage Properties, Ltd.


Schedule
III - Real Estate and Accumulated Depreciation





Initial
      Cost
            
            
            
            
            
            Gross
      Carrying Amount
                at
      December 31, 2009Description
            
            Land
            
            
            Buildings
                &
                Equipment
            
            
            Costs
      Subsequent to Construction
                (Improvements)
            
            
            Land
            
            
            Buildings
                &
                Equipment
            
            
            Total
            
            
            Accumulated
                Depreciation
            
            
            Date
                CompletedCaliforniaPasadena
            
            $
            327,000
            
            
            $
            515,000
            
            
            $
            343,000
            
            
            $
            327,000
            
            
            $
            858,000
            
            
            $
            1,185,000
            
            
            $
            805,000
            
            
            
            08/78Whittier
      - El Monte
            
            
            166,000
            
            
            
            763,000
            
            
            
            416,000
            
            
            
            134,000
            
            
            
            1,211,000
            
            
            
            1,345,000
            
            
            
            1,194,000
            
            
            
            07/78Fremont
            
            
            112,000
            
            
            
            741,000
            
            
            
            535,000
            
            
            
            112,000
            
            
            
            1,276,000
            
            
            
            1,388,000
            
            
            
            1,154,000
            
            
            
            11/78Milpitas
            
            
            198,000
            
            
            
            649,000
            
            
            
            398,000
            
            
            
            195,000
            
            
            
            1,050,000
            
            
            
            1,245,000
            
            
            
            932,000
            
            
            
            11/78Wilmington
            
            
            815,000
            
            
            
            1,336,000
            
            
            
            796,000
            
            
            
            815,000
            
            
            
            2,132,000
            
            
            
            2,947,000
            
            
            
            1,998,000
            
            
            
            08/78Sun
      Valley
            
            
            329,000
            
            
            
            611,000
            
            
            
            374,000
            
            
            
            329,000
            
            
            
            985,000
            
            
            
            1,314,000
            
            
            
            947,000
            
            
            
            10/78Corona
            
            
            155,000
            
            
            
            757,000
            
            
            
            399,000
            
            
            
            155,000
            
            
            
            1,156,000
            
            
            
            1,311,000
            
            
            
            1,059,000
            
            
            
            12/78Norco
            
            
            95,000
            
            
            
            456,000
            
            
            
            249,000
            
            
            
            95,000
            
            
            
            705,000
            
            
            
            800,000
            
            
            
            638,000
            
            
            
            12/78North
      Hollywood
            
            
            314,000
            
            
            
            553,000
            
            
            
            370,000
            
            
            
            314,000
            
            
            
            923,000
            
            
            
            1,237,000
            
            
            
            861,000
            
            
            
            12/79$
            2,511,000
            
            
            $
            6,381,000
            
            
            $
            3,880,000
            
            
            $
            2,476,000
            
            
            $
            10,296,000
            
            
            $
            12,772,000
            
            
            $
            9,588,000








Note:  Buildings
are depreciated over a useful life of 25 years.


F-12


Public
Storage Properties, Ltd.


Schedule
III - Real Estate and Accumulated Depreciation


(continued)




Reconciliation
of Real Estate Cost and Accumulated Depreciation




COST
      RECONCILIATION2009
            
            
            2008Balance
      at the beginning of the year
            
            $
            12,601,000
            
            
            $
            12,354,000Additions
      during the year: Improvements
            
            
            171,000
            
            
            
            247,000Balance
      at the end of the year
            
            $
            12,772,000
            
            
            $
            12,601,000ACCUMULATED
      DEPRECIATION RECONCILIATION2009
            
            
            
            2008Balance
      at the beginning of the year
            
            $
            9,441,000
            
            
            $
            9,299,000Depreciation
      expense
            
            
            147,000
            
            
            
            142,000Balance
      at the end of the year
            
            $
            9,588,000
            
            
            $
            9,441,000




(a)
            The
      aggregate depreciable cost prior to depreciation of real estate (excluding
      land) for federal income tax purposes is $9,263,000
      (unaudited).







F-13




SIGNATURES




Pursuant
to the requirements of the Section 13 or 15(d) of the Securities Exchange Act of
1934, the Partnership has duly caused this report to be signed on its behalf by
the undersigned, thereunto duly authorized.




PUBLIC
      STORAGE PROPERTIES, LTD.a
      California Limited PartnershipDate:  March
      25, 2010
            By:       Public
      Storage, General Partner
              
              By:     /s/ Ronald L. Havner,
      Jr.Ronald
      L. Havner, Jr.,
              Vice-Chairman
      of the Board,
              Chief
      Executive Officer and President of Public Storage, Corporate General
      Partner























F-14








Exhibit
      No.
            Exhibit Index31.1
            Rule
      13a - 14(a) Certification.  Filed herewith.31.2
            Rule
      13a - 14(a) Certification.  Filed herewith.32
            Section
      1350 Certifications.  Filed
herewith.









F-15